Surgery Partners Model Update

Research evidence excerpt

Surgery Partners Model Update

Benjamin Rossi AC North America Equity Research

(1-212) 622-9603 10 June 2026 J P M O R G A N

benjamin.rossi@jpmorgan.com

Price Performance Summary Investment Thesis and Valuation

Investment Thesis

We rate shares of Surgery Partners (SGRY) Neutral. We like the

company’s strategic shift to higher acuity procedures, large

TAM (~$150B), and lower cost profile when compared with IP

surgical procedures. We think the combination of these assets, in

addition to the company’s focus on procedures that should

experience growth along with the broader aging population in

the U.S. (particularly for cardiology and MSK), positions SGRY

well as outpatient methods of care become more prevalent.

However, while we remain constructive on the core business and

YTD 1m 3m 12m growth trajectory, we view SGRY as a relative Neutral within

Abs -9.6% -3.3% 5.0% -40.2% our coverage universe due to the company’s higher leverage,

Rel -25.1% -3.5% -7.3% -73.9%

cash flow conversion challenges, and timing-related issues to

Company Data the company’s M&A cadence.

Shares O/S (mn) 128

Valuation52-week range ($) 24.10-11.41

Market cap ($ mn) 1,792.00 Our December 2026 price target of $14 is based on a target EV/

Exchange rate 1.00 EBITDA multiple of ~10x our 2027 adj EBITDA estimate. Our

Free float (%) 59.8%

3M ADV (mn) 1.42 target multiple factors a more modest 2026 growth outlook,

3M ADV ($ mn) 19.0 changes to the company’s forward growth algorithm that now

Volatility (90 Day) 43 excludes M&A, and favorable revenue/EBITDA growth

Index RUSSELL 2000

BBG ANR (Buy | Hold | Sell) 9|4|0 profiles to peers.

Key Metrics (FYE Dec)

Performance Drivers$ in millions FY25A FY26E FY27E

Financial Estimates

Revenue 3,309 3,410 3,600

Adj. EBITDA 526 530 565

Adj. EBIT 213 343 405

Adj.