Does Upgraded 2025 Outlook and Expansion Signal a Stronger Growth Story for Select Medical (SEM)?

• In the past week, Select Medical Holdings reported third-quarter 2025 results with sales of US$1,363.45 million, up from US$1,271.58 million a year prior, alongside an acquisition of a 30-bed critical illness recovery hospital and continued expansion of its outpatient network.
• A significant insight is the company’s raised earnings guidance for the full year 2025, reflecting increased confidence due to favorable regulatory updates and ongoing investments in new facilities.
• We’ll examine how the upward revision of earnings guidance following a Medicare rule delay impacts Select Medical Holdings’ investment outlook.

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Select Medical Holdings Investment Narrative Recap

Shareholders in Select Medical Holdings generally need to believe in expanding demand for facility-based rehabilitation and critical illness recovery, underpinned by demographic trends and operational scaling. The latest news, a revenue beat and a Medicare rule delay, directly bolsters the most important short-term catalyst: boosted earnings from favorable reimbursement timing, while the biggest immediate risk, ongoing reimbursement pressure, remains but is less acute for now.

One relevant update is the company's raised 2025 earnings guidance, supported by recent regulatory relief and investment in new facilities. Management's confidence in reaffirming guidance, despite segment-specific challenges, underscores that current catalysts are being supported by external and internal factors. But on the other hand, investors should be aware of continued risks surrounding reimbursement pressures and...

Read the full narrative on Select Medical Holdings (it's free!)

Select Medical Holdings' narrative projects $6.1 billion in revenue and $233.8 million in earnings by 2028. This requires 5.1% yearly revenue growth and a $152.7 million earnings increase from $81.1 million currently.

Uncover how Select Medical Holdings' forecasts yield a $17.83 fair value, a 34% upside to its current price.

Exploring Other Perspectives

Private investors in the Simply Wall St Community place Select Medical’s fair value between US$4.54 and US$17.83, drawing on two independent forecasts. Amid recent regulatory tailwinds, you can see how perspectives differ widely on the company’s earnings upside and margin stability.

Explore 2 other fair value estimates on Select Medical Holdings - why the stock might be worth as much as 34% more than the current price!

Build Your Own Select Medical Holdings Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Select Medical Holdings research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Select Medical Holdings research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Select Medical Holdings' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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