Expanded Buyback and Broad Revenue Gains Could Be A Game Changer For Select Medical (SEM)

• In recent months, Select Medical Holdings extended its common share repurchase program through December 31, 2027, authorizing up to US$1.00 billion while also reporting revenue growth across its critical illness recovery hospital, rehabilitation hospital, and outpatient rehabilitation segments in Q3 2025.
• This combination of an enlarged buyback commitment and broad-based revenue gains has reinforced views about the company’s financial flexibility and business momentum.
• With the expanded US$1.00 billion repurchase authorization in focus, we’ll now explore how this development reshapes Select Medical’s investment narrative.

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Select Medical Holdings Investment Narrative Recap

To own Select Medical, you need to believe its mix of critical illness, inpatient rehab, and outpatient rehab can keep filling beds and clinics despite reimbursement and debt headwinds. The enlarged US$1.00 billion buyback and recent segment-wide revenue growth support the near term catalyst of improved investor confidence, but do not materially change the key risk around regulatory pressure on long term acute care hospital reimbursement and interest costs.

The most relevant recent development here is the extended common share repurchase authorization through December 31, 2027, with capacity of up to US$1.00 billion. This sits alongside raised 2025 revenue and EPS guidance, suggesting management is comfortable committing capital to shareholders while still funding rehab expansion and efficiency projects that underpin the longer term growth story.

Yet, against this backdrop of renewed capital returns, investors should be aware of how sustained Medicare reimbursement pressure and rising interest expense could...

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

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

Uncover how Select Medical Holdings' forecasts yield a $17.83 fair value, a 17% upside to its current price.

Exploring Other Perspectives

Two fair value estimates from the Simply Wall St Community span a wide range, from US$4.74 to US$17.83 per share, underscoring how differently investors can view the same company. Set against this, the expanded US$1.00 billion buyback and raised 2025 guidance highlight why it can be useful to weigh multiple opinions before deciding how much weight to place on Select Medical’s current business momentum.

Explore 2 other fair value estimates on Select Medical Holdings - why the stock might be worth as much as 17% 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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