Earnings results often indicate what direction a company will take in the months ahead. With Q1 behind us, let’s have a look at Select Medical (NYSE: SEM) and its peers.

The outpatient and specialty care industry delivers targeted medical services in non-hospital settings that are often cost-effective compared to inpatient alternatives. This means that they are more desired as rising healthcare costs and ways to combat them become more and more top-of-mind. Outpatient and specialty care providers boast revenue streams that are stable due to the recurring nature of treatment for chronic conditions and long-term patient relationships. However, their reliance on government reimbursement programs like Medicare means stroke-of-the-pen risk. Additionally, scaling a network of facilities can be capital-intensive with uneven return profiles amid competition from integrated healthcare systems. Looking ahead, the industry is positioned to grow as demand for outpatient services expands, driven by aging populations, a rising prevalence of chronic diseases, and a shift toward value-based care models. Tailwinds include advancements in medical technology that support more complex procedures in outpatient settings and the increasing focus on preventive care, which can be aided by data and AI. However, headwinds such as reimbursement rate cuts, labor shortages, and the financial strain of digitization may temper growth.

The 7 outpatient & specialty care stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 1.9% while next quarter’s revenue guidance was in line.

Luckily, outpatient & specialty care stocks have performed well with share prices up 32.9% on average since the latest earnings results.

Select Medical (NYSE: SEM)

With a nationwide network spanning 46 states and over 2,700 healthcare facilities, Select Medical (NYSE: SEM) operates critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occupational health centers across the United States.

Select Medical reported revenues of $1.42 billion, up 5% year on year. This print exceeded analysts’ expectations by 0.9%. Despite the top-line beat, it was still a slower quarter for the company with a significant miss of analysts’ EPS estimates and full-year EPS guidance in line with analysts’ estimates.

The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $16.52.

Read our full report on Select Medical here, it’s free.

Best Q1: agilon health (NYSE: AGL)

Transforming how doctors care for seniors by shifting financial incentives from volume to outcomes, agilon health (NYSE: AGL) provides a platform that helps primary care physicians transition to value-based care models for Medicare patients through long-term partnerships and global capitation arrangements.

agilon health reported revenues of $1.42 billion, down 7.3% year on year, outperforming analysts’ expectations by 3.2%. The business had a stunning quarter with EBITDA guidance for next quarter exceeding analysts’ expectations and a beat of analysts’ EPS estimates.

agilon health achieved the highest full-year guidance raise among its peers. On a dimmer note, the company lost 85,000 customers and ended up with a total of 426,000. The market seems happy with the results as the stock is up 217% since reporting. It currently trades at $88.20.

Is now the time to buy agilon health? Access our full analysis of the earnings results here, it’s free.

Weakest Q1: U.S. Physical Therapy (NYSE: USPH)

With a nationwide footprint spanning 671 clinics across 42 states, U.S. Physical Therapy (NYSE: USPH) operates a network of outpatient physical therapy clinics and provides industrial injury prevention services to employers across the United States.

U.S. Physical Therapy reported revenues of $198.3 million, up 7.9% year on year, in line with analysts’ expectations. It was a slower quarter as it posted a significant miss of analysts’ EPS estimates.

U.S. Physical Therapy delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 16.2% since the results and currently trades at $61.71.

Read our full analysis of U.S. Physical Therapy’s results here.

Encompass Health (NYSE: EHC)

With a network of 161 specialized facilities across 37 states and Puerto Rico, Encompass Health (NYSE: EHC) operates inpatient rehabilitation hospitals that help patients recover from strokes, hip fractures, and other debilitating conditions.

Encompass Health reported revenues of $1.59 billion, up 9% year on year. This print topped analysts’ expectations by 1.2%. It was a satisfactory quarter as it also logged a beat of analysts’ EPS estimates.

The stock is up 4.8% since reporting and currently trades at $104.76.

Read our full, actionable report on Encompass Health here, it’s free.

DaVita (NYSE: DVA)

With over 2,600 dialysis centers across the United States and a presence in 13 countries, DaVita (NYSE: DVA) operates a network of dialysis centers providing treatment and care for patients with chronic kidney disease and end-stage kidney disease.

DaVita reported revenues of $3.42 billion, up 6% year on year. This result surpassed analysts’ expectations by 2.1%. Overall, it was a very strong quarter as it also put up a beat of analysts’ EPS estimates and a solid beat of analysts’ full-year EPS guidance estimates.

The stock is up 23.2% since reporting and currently trades at $189.76.

Read our full, actionable report on DaVita here, it’s free.

Market Update

Late in 2025 into early 2026, there was hand wringing around artificial intelligence. For software companies, the fear was that AI would erode pricing power and compress margins as new tools made it easier to replicate what once required expensive enterprise platforms. Crypto investors had their own version of the same anxiety: if AI agents could trade, allocate capital, and manage wallets autonomously, what exactly was the long-term value of today’s crypto infrastructure?

These concerns triggered a noticeable rotation away from these sectors and into safer havens. But markets rarely dwell on one narrative for long. Spring 2026 came, and the focus shifted abruptly from technological disruption to geopolitical risk. The US’ conflict with Iran became the dominant driver of market psychology, and when geopolitics takes center stage, the script changes quickly. Investors stop debating growth rates and start worrying about oil supply, inflation, and global stability.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.