Select Medical Holdings Corporation Common Stock (SEM)

FairStock Score: 68/100 — STEADY

Key Financials

Strengths

• Generates $32 million in annual free cash flow (1.6% yield on market cap)
• Solid return on equity of 10.6% above cost of capital
• Revenue growth of 1239.3% demonstrates strong top-line momentum
• Established organization with 30,800 employees providing operational scale

Concerns

• Weak Piotroski F-Score of 3/9 suggests deteriorating financial quality across multiple dimensions
• Altman Z-Score of 0.8 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Select Medical Holdings Corporation Common Stock is a small-cap healthcare company valued at $2.0 billion. The business generates $5.5 billion in annual revenue with a 0.4% net margin and $32 million in free cash flow. From a quality standpoint, Select shows weak Piotroski F-Score of 3/9 signaling deteriorating fundamentals and distressed Altman Z-Score of 0.8 warrants caution. On valuation, the stock is attractively valued at 14.2x earnings, with a modest 13% margin of safety vs Graham Number. Growth dynamics show revenue growing at 1239.3% and profit growth of 225.7%. The 1.5% dividend yield adds an income component for patient holders. Our composite FairStock Score of 68/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Select's 1239% revenue growth trajectory could accelerate as it captures additional market share in the healthcare sector. With $32 million in annual free cash flow (1.6% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the healthcare space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer