Select Medical Reports Mixed Q1 2026 Results Amid $2.5 Billion Take-Private Deal
Event summary
- Select Medical reported Q1 2026 revenue growth of 5.0% to $1.42 billion, but net income fell 14.7% YoY to $63.8 million.
- Rehabilitation hospital segment grew revenue by 14.5%, while critical illness recovery hospitals saw flat growth (0.3%).
- Company agreed to $2.5 billion take-private deal at $16.50 per share, expected to close mid-2026 pending regulatory approvals.
- Declared quarterly dividend of $0.0625 per share, payable May 28, 2026.
The big picture
Select Medical's mixed Q1 results highlight the challenges of balancing growth across its three segments amid a major private equity takeover. The $2.5 billion deal reflects investor confidence in the company's rehabilitation hospital segment (up 14.5% YoY), but regulatory hurdles and declining margins in critical care services could complicate the transition to private ownership.
What we're watching
- Regulatory Hurdles
- Whether Select Medical can secure all necessary healthcare regulatory approvals for the $2.5 billion take-private deal by mid-2026.
- Segment Performance
- How the company will address declining profitability in its critical illness recovery segment (EBITDA margin down to 11.5% from 13.6%).
- Private Equity Strategy
- The pace at which Welsh Carson and consortium partners integrate Select Medical post-acquisition.
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