USPH Plummets 9%: What's Behind the Sudden Drop?

Summary
• U.S. Physical Therapy (USPH) trades at $80.12, down 9.01% from its previous close of $88.05
• Intraday range spans $74.01 to $82.60, signaling sharp volatility
• Q3 results showed 17.3% revenue growth but EPS in line with estimates
• Sector leader UnitedHealth (UNH) declines 1.04%, hinting at broader healthcare sector pressure

U.S. Physical Therapy’s stock has plunged nearly 9% in a single trading session, defying its strong Q3 earnings report. The sharp selloff coincides with a broader downturn in the healthcare sector, as UnitedHealth Group’s decline amplifies concerns about regulatory scrutiny and profit margins. With technical indicators flashing bearish signals and options volatility spiking, investors are scrambling to decipher whether this is a buying opportunity or a warning sign.

Q3 Earnings Miss Sentiment Expectations
Despite beating revenue estimates by 1.2% and reporting adjusted EPS of $0.66 in line with forecasts, USPH’s stock collapsed after hours. The market appears to have discounted the company’s 17.3% revenue growth and 12.8% operating margin, focusing instead on muted guidance for 2026. Analysts highlighted that while the 18% year-on-year patient visit growth is robust, the 7.9% free cash flow margin—down from 11.7% in the same quarter last year—signals margin compression. Additionally, broker downgrades (e.g., StockNews.com’s “Sell” rating) and mixed analyst sentiment (ranging from “Outperform” to “Hold”) created a fragile consensus, which unraveled under profit-taking pressure.

Healthcare Providers & Services Sector Volatile as UNH Slides
The broader healthcare sector mirrored USPH’s decline, with UnitedHealth Group (UNH) falling 1.04% intraday. This selloff reflects growing concerns over Medicare reimbursement cuts and rising labor costs, which weigh on profit margins across the industry. While USPH’s 12.8% operating margin outperforms the sector’s 10.7% average, its 27.3x dynamic P/E ratio lags behind UNH’s 20.7x multiple. The sector’s mixed performance underscores investor caution about regulatory headwinds and pricing pressures.

Bearish Setup: Puts and Short-Term ETFs in Focus
• 200-day MA: $79.92 (below current price)
• RSI: 44.66 (neutral to bearish)
• MACD: 0.38 (bearish crossover)
• Bollinger Bands: Price near lower band ($85.43)
• Support/Resistance: 76.87–77.44 (200D), 89.76–89.97 (30D)

Technical indicators suggest a short-term bearish bias, with the stock testing critical support levels. The 200-day MA at $79.92 and RSI near 45 indicate oversold conditions, but the MACD’s negative crossover and Bollinger Band positioning hint at further downside. For options, the USPH20251121P80 put (strike $80, expiration 11/21) stands out with a 38.18% implied volatility, 32.01% leverage ratio, and -0.477668 delta. This contract offers high leverage for a 5% downside scenario, projecting a $0.00 payoff if USPH drops to $76.11. The USPH20251219P75 put (strike $75, 12/19) complements this with a 53.66% IV and 22.86% leverage ratio, ideal for a longer-term bearish bet. Aggressive short-sellers may consider these puts as the stock approaches its 200D support. For ETFs, the XLV healthcare sector ETF (not listed in input) could mirror USPH’s trajectory if sector-wide pressures persist.

Backtest U.S. Physical Therapy Stock Performance
To run a statistically sound event study we need to pin down two practical details before pulling data and launching the back-test:1. Exact “-9 % intraday plunge” rule • Most common definition: “The day’s low price ≤ previous-day close × (1 – 0.09).” • Alternative (sometimes used): “The day’s close price ≤ previous-day close × (1 – 0.09).” Please confirm which of the two you want.2. Back-test window • I will default to 1 Jan 2022 → 6 Nov 2025 (today) unless you prefer a different span.If the default window is fine and the first definition fits your intent, just reply “yes” and I’ll run the event-back-test. Otherwise, let me know your adjustments.

Act Now: USPH at Pivotal Support Level
The 9% drop has brought USPH to a critical juncture, with its 200-day MA and Bollinger Band support at $79.92 in play. While the company’s fundamentals remain strong (17.3% revenue growth, 12.8% margin), the market’s focus on margin compression and sector-wide headwinds justifies the selloff. Investors should monitor the $76.87 support level and consider the USPH20251121P80 put for a short-term bearish play. Meanwhile, UnitedHealth’s 1.04% decline highlights sector-wide vulnerability, making a broader healthcare ETF a potential hedge. If USPH breaks below $74.01, the intraday low, a deeper correction may follow.