The Deal Behind Mizuho’s Downgrade of Surgery Partners (SGRY) Farooq Fri, November 13, 2026 at 4:10 PM EST 4 min read SGRY +1.05% ^GSPC -0.40% ^IXIC -0.91% CL=F +0.32% ^DJI +0.10% Trade SGRY on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
We just published a list of the Sell Alert: 10 Stocks Analysts Downgraded on Wednesday and Surgery Partners (NASDAQ:SGRY) ranked 10th on this list.
Wall Street got a sharp reminder this month of how fast sentiment can turn. Last Thursday the S&P 500 lost 4.4%, its worst day since April 2025, after midterm election results raised fears that regulation could hurt the AI trade. The Nasdaq Composite fell into correction territory, roughly 11% below the record it set in early October.
A rally on lower oil prices offered some relief at the start of this week. Then inflation data reopened the wound. Consumer prices rose 0.4% in October, the third straight monthly gain of at least that size and a touch above the 0.3% economists had expected. The stock market was still nervous from the prior week's rout, and it showed. The S&P 500 fell 0.38% to 7,520.93, the Dow lost 0.30% and the Nasdaq Composite slid 0.74% on the news.
Federal Reserve Governor Christopher Waller said the central bank should raise interest rates in December and consider a half-point increase if inflation worsens. Dallas Fed President Lorie Logan went further, saying at least two more quarter-point hikes are needed to bring prices under control. Three straight monthly gains of 0.4% or more is the kind of streak that keeps rate-hike talk alive.
Traders have taken the message seriously. They now price roughly an 84% chance of a quarter-point December hike, after a week in which both the stock and bond markets swung hard.
Investors tracking how far some AI stocks have fallen can find more names in our ranking of oversold AI stocks that analysts see rebounding by more than half.
Technology shares have taken the brunt of it. Selling in semiconductor stocks reached its most extreme level since 2019 earlier this week, by Yahoo Finance's measure, as worries about regulation of the AI trade added to the pressure.
Wednesday brought a rebound. The S&P 500 climbed 1.31% to 7,619.38, the Nasdaq Composite gained 1.60%, and the Dow rose 0.49%. The Nasdaq Composite had slipped into correction territory only days earlier. One day of gains does not erase the damage from the prior week, and the inflation and rate questions behind the selloff are still open. The Dow finished the day at 52,486.49.
Investors comparing cheaper alternatives can start with our roundup of affordable stocks that Wall Street analysts favor.
For now, the Federal Reserve's December meeting is the date traders are watching, with a hike priced as the likely outcome.
Surgery Partners made it to our list because it has an average upside potential of -8%. Mizuho cut Surgery Partners to Neutral from Outperform on November 11 and raised its price target to $25 from $19, which matches the cash price in the pending buyout. The downgrade follows third-quarter results and a revised offer from HealthSpan Partners. A rival bid of $28 a share arrived, but the board kept backing the amended HealthSpan deal, citing a greater certainty of closing and lower regulatory risk.
Bain Capital owns about 39% of the shares and has agreed to vote for the HealthSpan transaction. Given that support and the board's recommendation, Mizuho expects shareholders to approve it. The firm also called the deal price a fair multiple of its 2027 adjusted EBITDA estimate for the business, and it updated its estimates through 2028 alongside the call. A special committee unanimously recommended the amended deal.
Surgery Partners runs outpatient surgery centers, and its stock surged when the first offer surfaced. The company has cancelled its forward guidance, so the transaction, expected to close in the first quarter of 2027, now drives the shares. We covered what to expect next after that surge in an earlier piece.
While we acknowledge the risk and potential of SGRY as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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