What drove SGRY's consistent earnings growth in 2024?

Surgery Partners (SGRY) experienced consistent earnings growth in 2024 due to a combination of factors: 1. **Revenue Growth**: The company reported a 17.5% increase in revenue for Q4 2024, reaching $864.4 million. This growth was driven by increased surgical cases and strategic investments in high-acuity specialties, particularly orthopedics. The full-year revenue exceeded $3 billion for the first time, indicating a strong market presence and operational efficiency. 2. **Adjusted EBITDA Expansion**: Surgery Partners achieved an adjusted EBITDA of $508.2 million for the year, up from $438.1 million in the previous year. This expansion reflects effective cost management initiatives and the company's ability to generate substantial earnings before interest, taxes, depreciation, and amortization. 3. **Strategic Investments and Acquisitions**: The company's focus on strategic expansion, including the acquisition of new physicians and facilities, has contributed to its growth. Over 200 new physicians were recruited, and there was a 46% increase in total joint replacements in the first half of 2024 compared to the prior year. These strategic moves have enhanced the company's service offerings and market share. 4. **Financial Metrics Improvement**: Despite a net loss attributable to the company, the net loss decreased from $11.9 million in the previous year to $168.1 million. This indicates improved financial stability and operational performance. The P/E ratio has shown fluctuations, but the overall trend suggests that the stock may be undervalued, which could attract more investors. 5. **Analyst Confidence**: The consensus rating for Surgery Partners remains "Buy" with an average price target of $35.29, indicating analyst confidence in the company's future performance. This optimism is supported by the company's strong revenue growth and strategic positioning. In conclusion, Surgery Partners' consistent earnings growth in 2024 can be attributed to its strategic investments, revenue expansion, adjusted EBITDA growth, and financial metrics improvement. These factors, coupled with positive analyst ratings, position the company for continued growth in the foreseeable future.