As healthcare delivery shifts away from traditional hospitals, investors are weighing the merits of outpatient giants versus home-based specialists. Choosing between Surgery Partners (SGRY +2.48%) and Viemed Healthcare (VMD +0.29%) depends on your preferred medical niche.
Surgery Partners operates a massive network of surgical facilities, while Viemed focuses on high-tech respiratory care within patients’ homes. They represent two different ways to play on the rising demand for efficient, lower-cost healthcare. Both companies are navigating a complex regulatory environment while scaling their service models across the United States.
The case for Surgery Partners
SGRY focuses on providing surgical solutions through a network of outpatient centers and surgical hospitals. It operates more than 300 locations across 30 states to serve patients and physicians. Within the broader healthcare stock market, the company generates revenue primarily through patient services, with 42.7% from government payors and 52.3% from private insurance. This concentration in large payor groups is a central part of its revenue model.
In FY 2025, revenue reached just over $3.3 billion, up approximately 6% from the prior year. Despite the rising revenue, the company reported a net loss of about $77.9 million for the period. Management has focused on expanding its footprint to drive these top-line gains at the cost of turning near-term profits.
As of its December 2025 balance sheet, the company maintained a debt-to-equity ratio of 2.3x. This metric, which measures total debt against shareholder equity, suggests a significant reliance on borrowed funds. The current ratio, which compares short-term assets to liabilities, was 1.9x, while free cash flow reached $195.6 million. This cash flow figure is calculated by subtracting capital expenditures from operating cash flow.
The case for Viemed Healthcare
Viemed Healthcare specializes in home-based respiratory care and disease management services. It provides equipment and staffing to help patients manage chronic conditions without leaving their residences. The company has expanded its reach significantly, now providing services across all 50 states and employing more than 1,300 people. Its focus on the aging population and chronic respiratory issues positions it in a high-demand niche.
During FY 2025, the company generated revenue of approximately $270.3 million, an increase of roughly 21% over the previous year. This growth resulted in net income of $14.9 million for the fiscal year. The company achieved a net margin of 5.5%, indicating how much profit it keeps for every dollar of sales. This margin has remained relatively stable even as the company scales its operations.
Based on the December 2025 balance sheet, the debt-to-equity ratio was nearly 0.1x. This indicates a very low debt-to-equity ratio, suggesting a conservative financial structure. The current ratio was 1.2x, and the company generated free cash flow of approximately $11.9 million during the year. Free cash flow is the cash a company generates after accounting for capital expenditures.
Risk profile comparison
Surgery Partners faces significant regulatory risks due to its compliance with federal laws such as the Anti-Kickback Statute. It also carries approximately $3.7 billion in debt, which could limit its ability to respond to economic shifts. Competition from large health systems like Tenet Healthcare (THC +0.86%) for physicians and patients remains a constant challenge for the business.
Viemed Healthcare is highly dependent on Medicare reimbursement rates, meaning changes in government policy can directly impact its revenue. It also faces competition from larger, better-capitalized firms in the respiratory care market. Additionally, the company relies on third-party suppliers for medical equipment, which creates risks if supply chains are disrupted or product costs rise.
Valuation comparison
Viemed Healthcare appears more attractive based on its profitability and lower earnings multiple, whereas Surgery Partners offers a much lower valuation relative to its total annual sales.
| Metric | Surgery Partners | Viemed Healthcare | Sector Benchmark |
|---|---|---|---|
| Forward P/E | 33.7x | 22.2x | 24.9x |
| P/S ratio | 0.6x | 1.4x | n/a |
Sector benchmark uses the SPDR XLV sector ETF.
Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.
Which stock would I buy in 2026?
Home-based care for patients is increasingly favored by insurance companies seeking to tamp down rising hospital costs. It is also a natural outgrowth of America’s aging population. That makes Viemed appear to be the clear choice over Surgery Partners.
Viemed’s first-quarter 2026 revenue was up more than 28% from the prior-year period, reflecting management’s success in garnering greater attention for at-home treatments for common health issues, such as sleep apnea. The business is also seeing its sleep-related and maternal care operations expand, helping diversify its revenue base away from the federal government. For the full year, analyst consensus is for revenue to rise more than 17% to about $317 million. Meanwhile, Wall Street expects Surgery Partners’ revenue to inch up by just about 3% for the year.
