NYSE:SEM

Stock Analysis Report

Select Medical Holdings

Executive Summary

Select Medical Holdings Corporation, through its subsidiary, Select Medical Corporation, operates critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occupational health centers in the United States.

Snowflake

Fundamentals

Fair value with imperfect balance sheet.


Similar Companies

Share Price & News

How has Select Medical Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

3.7%

SEM

7.0%

US Healthcare

1.0%

US Market


1 Year Return

2.9%

SEM

-8.8%

US Healthcare

8.0%

US Market

Return vs Industry: SEM exceeded the US Healthcare industry which returned -8.8% over the past year.

Return vs Market: SEM underperformed the US Market which returned 8% over the past year.


Shareholder returns

SEMIndustryMarket
7 Day3.7%7.0%1.0%
30 Day0.9%1.8%-0.07%
90 Day2.6%-2.7%-1.0%
1 Year2.9%2.9%-7.3%-8.8%10.4%8.0%
3 Year33.9%33.9%33.7%27.7%46.2%36.7%
5 Year35.3%33.3%59.4%48.8%64.3%46.2%

Price Volatility Vs. Market

How volatile is Select Medical Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Select Medical Holdings undervalued compared to its fair value and its price relative to the market?

31.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SEM ($17.14) is trading below our estimate of fair value ($25)

Significantly Below Fair Value: SEM is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: SEM is good value based on its PE Ratio (16.2x) compared to the Healthcare industry average (21.1x).

PE vs Market: SEM is good value based on its PE Ratio (16.2x) compared to the US market (17.6x).


Price to Earnings Growth Ratio

PEG Ratio: SEM is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: SEM is overvalued based on its PB Ratio (2.7x) compared to the US Healthcare industry average (2.5x).


Next Steps

Future Growth

How is Select Medical Holdings forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

8.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SEM's forecast earnings growth (8.2% per year) is above the savings rate (2.7%).

Earnings vs Market: SEM's earnings (8.2% per year) are forecast to grow slower than the US market (14.5% per year).

High Growth Earnings: SEM's earnings are forecast to grow, but not significantly.

Revenue vs Market: SEM's revenue (3.9% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: SEM's revenue (3.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SEM's Return on Equity is forecast to be low in 3 years time (15.6%).


Next Steps

Past Performance

How has Select Medical Holdings performed over the past 5 years?

6.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: SEM's earnings have grown by 6.8% per year over the past 5 years.

Accelerating Growth: SEM's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SEM had negative earnings growth (-28.2%) over the past year, making it difficult to compare to the Healthcare industry average (5.6%).


Return on Equity

High ROE: SEM's Return on Equity (10.1%) is considered low.


Return on Assets

ROA vs Industry: SEM's Return on Assets is below or equal to the Healthcare industry average last year.


Return on Capital Employed

ROCE Improving: SEM's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Select Medical Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: SEM's short term assets ($1.0B) exceeds its short term liabilities ($852.7M)

Long Term Liabilities: SEM's short term assets (1.0B) do not cover its long term liabilities (4.4B)


Debt to Equity History and Analysis

Debt Level: SEM's debt to equity ratio (183.3%) is considered high

Reducing Debt: SEM's debt to equity ratio has reduced from 214.3% to 183.3% over the past 5 years.

Debt Coverage: SEM's debt is not well covered by operating cash flow (12.2%).

Interest Coverage: SEM's interest payments on its debt are not well covered by EBIT (2.1x coverage).


Balance Sheet

Inventory Level: SEM has a high level of physical assets or inventory.

Debt Coverage by Assets: SEM's debt is not covered by short term assets (assets are 0.3x debt).


Next Steps

Dividend

What is Select Medical Holdings's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage1.6%forecastin3Years0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: Unable to evaluate SEM's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate SEM's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if SEM's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SEM's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: SEM is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of SEM's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Select Medical Holdings's salary, the management and board of directors tenure and is there insider trading?

20.4yrs

Average management tenure


CEO

David Chernow (62yo)

5.8yrs

Tenure

US$8,201,031

Compensation

Mr. David S. Chernow has been the Chief Executive Officer at Select Medical Holdings Corporation and Select Medical Corporation since January 1, 2014. Mr. Chernow has been the President of Select Medical H ...


CEO Compensation Analysis

Compensation vs. Market: David's total compensation ($USD8.20M) is about average for companies of similar size in the US market ($USD4.07M).

Compensation vs Earnings: David's compensation has been consistent with company performance over the past year.


Management Age and Tenure

20.4yrs

Average Tenure

59.5yo

Average Age

Experienced Management: SEM's management team is seasoned and experienced (20.4 years average tenure).


Board Age and Tenure

7.6yrs

Average Tenure

67.5yo

Average Age

Experienced Board: SEM's board of directors are considered experienced (7.6 years average tenure).


Insider Trading

Insider Buying: SEM insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$161,27710 Sep 19
Scott Romberger
EntityIndividual
Role
Chief Accounting Officer
Senior VP
Shares9,344
Max PriceUS$17.26
SellUS$54,62506 Aug 19
Robert Breighner
EntityIndividual
Role
Chief Compliance Officer
VP of Compliance & Audit Services and Corporate Compliance Officer
Shares3,589
Max PriceUS$15.22
BuyUS$4,340,84318 Mar 19
Rocco Ortenzio
EntityIndividual
Role
Vice Chairman
Co-Founder & Vice Chairman
Shares306,189
Max PriceUS$14.25

Ownership Breakdown


Management Team

  • Rocco Ortenzio (86yo)

    Co-Founder & Vice Chairman

    • Tenure: 5.8yrs
    • Compensation: US$5.64m
  • David Chernow (62yo)

    President & CEO

    • Tenure: 5.8yrs
    • Compensation: US$8.20m
  • Bob Ortenzio (61yo)

    Co-Founder & Executive Chairman

    • Tenure: 5.8yrs
    • Compensation: US$8.22m
  • Marty Jackson (64yo)

    Executive VP & CFO

    • Tenure: 20.4yrs
    • Compensation: US$4.95m
  • Michael Tarvin (58yo)

    Executive VP

    • Tenure: 22.7yrs
    • Compensation: US$3.44m
  • Scott Romberger (58yo)

    Senior VP

    • Tenure: 18.8yrs
    • Compensation: US$380.36k
  • Robert Breighner (50yo)

    VP of Compliance & Audit Services and Corporate Compliance Officer

    • Tenure: 0yrs
  • Joel Veit

    Senior VP & Treasurer

    • Tenure: 0yrs
  • John Saich (50yo)

    Executive VP & Chief Administrative Officer

    • Tenure: 1yrs

Board Members

  • Bryan Cressey (70yo)

    Independent Director

    • Tenure: 14.7yrs
    • Compensation: US$317.00k
  • Russell Carson (76yo)

    Lead Director

    • Tenure: 4.8yrs
    • Compensation: US$297.00k
  • Rocco Ortenzio (86yo)

    Co-Founder & Vice Chairman

    • Tenure: 5.8yrs
    • Compensation: US$5.64m
  • Bob Ortenzio (61yo)

    Co-Founder & Executive Chairman

    • Tenure: 5.8yrs
    • Compensation: US$8.22m
  • Tom Scully (61yo)

    Independent Director

    • Tenure: 15.7yrs
    • Compensation: US$300.00k
  • Dan Thomas (60yo)

    Director

    • Tenure: 0.3yrs
  • Leo Swergold (78yo)

    Independent Director

    • Tenure: 14.2yrs
    • Compensation: US$320.00k
  • Bill Frist (67yo)

    Independent Director

    • Tenure: 9.4yrs
    • Compensation: US$308.00k
  • Marilyn Tavenner (68yo)

    Independent Director

    • Tenure: 0.9yrs
    • Compensation: US$180.80k
  • James Ely (61yo)

    Independent Director

    • Tenure: 10.9yrs
    • Compensation: US$325.00k

Company Information

Select Medical Holdings Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Select Medical Holdings Corporation
  • Ticker: SEM
  • Exchange: NYSE
  • Founded: 1996
  • Industry: Health Care Facilities
  • Sector: Healthcare
  • Market Cap: US$2.325b
  • Shares outstanding: 135.62m
  • Website: https://www.selectmedical.com

Number of Employees


Location

  • Select Medical Holdings Corporation
  • 4714 Gettysburg Road
  • PO Box 2034
  • Mechanicsburg
  • Pennsylvania
  • 17055
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SEMNYSE (New York Stock Exchange)YesCommon StockUSUSDSep 2009
S24DB (Deutsche Boerse AG)YesCommon StockDEEURSep 2009

Biography

Select Medical Holdings Corporation, through its subsidiary, Select Medical Corporation, operates critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occup ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/22 00:15
End of Day Share Price2019/10/21 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.