Summary: Select Medical Corp. Apr 08

  • ID: 2127788
  • April 2008
  • Standard & Poors
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The low speculative-grade rating on Mechanicsburg, Pa.-based Select Medical Corp. reflects the company's relatively narrow service niche as an operator of long-term acute-care hospitals (LTACHs), inpatient rehabilitation hospitals, and outpatient rehabilitation clinics. In addition, regulatory and reimbursement concerns remain prominent risks, particularly because the company derives nearly one-half of its revenues from Medicare. The rating also reflects Select's debt-laden capital structure related to its 2005 leveraged buyout. Somewhat better near-term earnings prospects may help support its highly leveraged financial risk profile; however, limited free operating cash flow likely will prevent a significant reduction of high debt levels. Select is one of the two largest operators of LTACHs in the U.S. and is the largest operator of outpatient rehabilitation clinics. The...

Companies mentioned in this report are:
- Select Medical Corp.

Action: Review

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- Select Medical Corp.

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