Operating cash flow frequently decouples from net income, evidenced by a negative OCF/NI ratio of -0.08 in 2026Q1, complicating the company's ability to fund its 4% revenue-weighted CapEx requirements.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 |
|---|
| Cash from Operations | 346.47M | 346.47M | 517.86M | 582.06M | 284.82M | 401.23M | 1.03B | 445.18M | 494.19M | 238.13M | 346.6M | 208.41M | 170.64M | 192.52M | 298.68M | 217.13M | 144.54M | 165.64M | 107.44M | 86.01M | 227.65M | 57.21M |
| Operating CF Margin % | - | 6.35% | 9.98% | 8.73% | 4.5% | 6.47% | 18.59% | 8.16% | 9.73% | 5.36% | 8.09% | 5.57% | 5.57% | 6.47% | 10.13% | 7.74% | 6.05% | 7.4% | 4.99% | 4.32% | 12.3% | 3.08% |
| Operating CF Growth % | -112.19% | -33.1% | -11.03% | 104.36% | -29.01% | -60.97% | 130.93% | -9.92% | 107.53% | -31.3% | 66.3% | 22.14% | -11.37% | -35.54% | 37.56% | 50.22% | -12.74% | 54.17% | 24.91% | -62.22% | 297.91% | - |
| Net Income | 133.53M | 146.22M | 296.7M | 299.73M | 198.03M | 499.95M | 344.61M | 201.03M | 176.94M | 220.65M | 125.27M | 136M | 128.18M | 123.01M | 153.89M | 112.76M | 82.36M | 78.89M | 25.83M | 35.43M | 94.88M | -27.92M |
| Depreciation & Amortization | 140.3M | 140.3M | 203.89M | 208.74M | 205.82M | 202.65M | 205.66M | 212.58M | 201.66M | 160.01M | 145.31M | 104.98M | 68.35M | 64.39M | 63.31M | 71.52M | 68.71M | 72.66M | 71.79M | 58.62M | 48.02M | 46.12M |
| Stock-Based Compensation | 12.18M | 16.7M | 100.67M | 43.81M | 37.76M | 30.94M | 27.25M | 26.45M | 23.33M | 19.28M | 17.41M | 14.98M | 11.19M | 7.03M | 5.68M | 3.73M | 2.24M | 5.15M | 2.09M | 3.75M | 3.78M | 0 |
| Deferred Taxes | 30.65M | 30.65M | -32.43M | -16.12M | 7.52M | 5.05M | -14.71M | -7.43M | 7.22M | -72.32M | -12.59M | -2.06M | 14.31M | 7.03M | 7.91M | 35.3M | 9.45M | 27.1M | 21.76M | 2.46M | -15.29M | 0 |
| Other Non-Cash Items | 147.81M | 72.27M | 4.17M | -13.6M | -4.76M | -7.38M | -13.82M | 25.65M | 656K | 85.75M | 52.98M | 35.33M | 58.29M | 61.55M | 39.07M | 43.68M | 33.44M | 704K | 48.93M | 41.53M | 24.43M | 47.85M |
| Working Capital Changes | -180.82M | -59.68M | -55.14M | 59.5M | -159.54M | -329.98M | 479.1M | -13.09M | 84.4M | -175.24M | 18.22M | -80.82M | -109.68M | -70.49M | 28.82M | -49.86M | -51.66M | -18.86M | -62.96M | -55.78M | 71.83M | -8.83M |
| Change in Receivables | -45.19M | -45.19M | -95.84M | 1.16M | -52.18M | 23.1M | -116.6M | -57.99M | 54.58M | -197.19M | -39.32M | -92.57M | -97.8M | -67.14M | 15.16M | -111.13M | -64.33M | -35.45M | -88.55M | -75.54M | 30.8M | -51.88M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | -82.77M | 167.65M | 0 | 0 | 1.6M | 17.45M | 4.7M | -17.77M | 1.42M | 13.91M | 39.22M | 19.02M | -4.92M | 10.02M | 13.62M | 22.5M | 31.66M |
| Change in Payables | -854K | -854K | -16.79M | -6.41M | -48.04M | 53.39M | 27.32M | 5.74M | 26.12M | 21.24M | 30.8M | 2.35M | 6M | -1.28M | -6.12M | 20.63M | -7.16M | 963K | -1.35M | -112K | 12.08M | 7.13M |
| Cash from Investing | -213.55M | -216.49M | -231.01M | -268.48M | -226.34M | -256.59M | -115.35M | -316.73M | -697.14M | -192.97M | -554.32M | -1.21B | -101.09M | -107.31M | -72.41M | -54.73M | -217M | -77.92M | -60.44M | -382.68M | -81.48M | -220.81M |
| Capital Expenditures | -229.22M | 36.27M | -222.18M | -229.2M | -190.37M | -180.54M | -146.44M | -157.13M | -167.28M | -233.24M | -161.63M | -182.64M | -95.25M | -73.66M | -68.19M | -46.02M | -51.76M | -57.88M | -56.5M | -166.07M | -155.1M | -109.95M |
| CapEx % of Revenue | 4.15% | 0.67% | 4.28% | 3.44% | 3.01% | 2.91% | 2.65% | 2.88% | 3.29% | 5.25% | 3.77% | 4.88% | 3.11% | 2.48% | 2.31% | 1.64% | 2.17% | 2.58% | 2.62% | 8.34% | 8.38% | 5.92% |
| Acquisitions | -6.45M | -9.2M | -13.1M | -39.44M | -44.31M | -102.88M | -52.23M | -159.79M | -536.62M | -40.07M | -473.15M | -1.03B | -5.84M | -36.56M | -20.73M | -16.6M | -165.8M | -21.38M | -4.96M | -227.38M | 71.7M | -111.55M |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | 22.13M | -243.56M | 4.26M | 163K | 8.34M | 26.82M | 83.32M | 192K | 6.76M | 80.35M | 80.46M | 1.77M | -4.63M | 2.91M | 16.51M | 7.88M | 565K | 1.34M | 1.02M | 10.77M | 1.91M | 686K |
| Cash from Financing | -166.09M | -163.15M | -311.17M | -327.48M | -34.89M | -647.38M | -671.54M | 32.25M | 255.57M | -21.65M | 292.31M | 1.01B | -70.52M | -121.04M | -198.18M | -154.72M | -6.85M | -68.3M | 12.73M | 219.59M | -100.47M | -48.51M |
| Debt Issued (Net) | 37.45M | 42.34M | -493.46M | -203.95M | 264.68M | 195.7M | -48.12M | 73.46M | 570.92M | -18.27M | 294.38M | 836.55M | 116.86M | -65.29M | 67.59M | -77.51M | 41.48M | -382.97M | 15.21M | 221.04M | -98.66M | 1.16B |
| Equity Issued (Net) | -100.08M | -100.08M | 473.29M | -12.76M | -195.53M | -79.48M | -16.03M | -38.53M | -6.84M | -4.75M | -2.93M | -15.83M | -130.73M | -11.78M | -45.09M | -72.6M | -43.9M | 66K | -522K | 252K | -41K | -1.69B |
| Dividends Paid | -31.43M | -31.43M | -64.62M | -63.9M | -64.59M | -50.6M | 0 | 0 | 0 | 0 | 0 | -13.13M | -53.37M | -41.96M | -210.89M | 0 | 0 | 0 | 0 | -1.7M | -1.76M | -176.94M |
| Share Repurchases | -100.08M | -100.08M | -37.91M | -12.76M | -195.53M | -79.48M | -16.03M | -38.53M | -6.84M | -4.75M | -2.93M | -15.83M | -130.73M | -11.78M | -46.9M | -72.8M | -44.14M | -80K | -612K | -14K | -41K | -1.69B |
| Other Financing | -72.03M | -73.98M | -226.38M | -46.86M | -39.45M | -713.01M | -607.39M | -2.68M | -308.51M | 1.38M | 864K | 206.83M | -3.28M | -2.01M | -9.79M | -4.61M | -4.43M | 314.6M | -1.96M | 0 | 0 | 655.09M |
| Net Change in Cash | -33.17M | -33.17M | -24.31M | -13.9M | 23.6M | -502.75M | 241.18M | 160.7M | 52.63M | 23.52M | 84.59M | 11.08M | -965K | -35.83M | 28.1M | 7.68M | -79.31M | 19.42M | 59.73M | -77.07M | 45.74M | -211.62M |
| Free Cash Flow | 117.24M | 382.74M | 539.65M | 352.86M | 94.45M | 220.69M | 881.63M | 288.06M | 326.91M | 4.89M | 184.97M | 25.77M | 75.4M | 118.86M | 230.5M | 171.11M | 92.78M | 107.76M | 50.93M | -80.06M | 72.56M | -52.73M |
| FCF Margin % | 2.12% | 7.02% | 10.4% | 5.29% | 1.49% | 3.56% | 15.94% | 5.28% | 6.43% | 0.11% | 4.32% | 0.69% | 2.46% | 3.99% | 7.82% | 6.1% | 3.88% | 4.81% | 2.37% | -4.02% | 3.92% | -2.84% |
| FCF Growth % | -67.35% | -29.08% | 52.94% | 273.58% | -57.2% | -74.97% | 206.06% | -11.89% | 6588.07% | -97.36% | 617.69% | -65.82% | -36.57% | -48.43% | 34.71% | 84.44% | -13.91% | 111.57% | 163.62% | -210.35% | 237.58% | - |
| FCF per Share | 0.95 | 3.10 | 4.33 | 2.87 | 0.76 | 1.69 | 6.79 | 2.21 | 2.51 | 0.04 | 1.45 | 0.20 | 0.58 | 0.87 | 1.66 | 1.14 | 0.58 | 1.25 | 0.86 | -1.32 | 1.19 | -0.86 |
| FCF Conversion (FCF/Net Income) | 0.88x | 2.37x | 2.42x | 2.39x | 1.79x | 1.00x | 3.97x | 3.00x | 3.59x | 1.34x | 3.00x | 1.59x | 1.41x | 1.68x | 2.01x | 2.01x | 1.86x | 2.20x | 4.79x | 2.43x | 2.40x | -2.05x |
| Interest Paid | 38.29M | 0 | 256.23M | 272.26M | 183.45M | 132.2M | 155.24M | 182.99M | 193.41M | 149.16M | 142.64M | 103.17M | 78.81M | 89.06M | 80.72M | 107.49M | 105.94M | 126.69M | 135.84M | 134.53M | 0 | 0 |
| Taxes Paid | 19.58M | 0 | 133.19M | 88.51M | 32.29M | 181.18M | 108.89M | 70.59M | 48.15M | 64.99M | 70.76M | 79.42M | 77.77M | 64.96M | 77.61M | 39M | 37.81M | 18.08M | 5.31M | 9.01M | 0 | 0 |
Clinical labor wage inflation
As reported in recent financial statements, Select Medical's operating cash flow frequently decouples from net income, evidenced by a negative OCF/NI ratio of -0.08 in 2026Q1, which suggests that accounting earnings are not consistently translating into the liquid resources necessary to support the company's high-acuity operational model.
The significant divergence between net income and operating cash flow indicates that non-cash items and working capital swings are heavily influencing reported profitability. Investors should monitor whether this disconnect reflects structural delays in government reimbursement or an underlying inability to convert clinical service delivery into realized cash inflows.
Based on the provided cash flow data, Select Medical's free cash flow trajectory remains highly erratic, swinging from a peak of $222.6 million in 2024Q2 to a deficit of $119.2 million in 2024Q1, which highlights the difficulty in forecasting sustainable cash generation for long-term debt service.
The extreme variance in FCF margins suggests that the company's cash flow profile is highly sensitive to the timing of receipts and the lumpy nature of healthcare expenditures. This lack of predictability may complicate management's ability to commit to consistent capital allocation strategies without risking liquidity constraints.
According to quarterly cash flow filings, working capital changes have been a primary source of cash flow volatility, with a massive $246.2 million outflow in 2024Q1 followed by a $146.8 million inflow in 2024Q2, indicating significant friction in the company's cash conversion cycle.
These dramatic fluctuations in working capital suggest that the company's accounts receivable and payable management are highly susceptible to external payment timing, particularly regarding government-reimbursed claims. Such instability warrants further investigation into the efficiency of the company's billing and collection processes within its joint venture network.
As indicated by recent financial disclosures, Select Medical maintains a consistent capital expenditure profile, with CapEx/Revenue ratios often exceeding 4% in periods like 2025Q4, which reflects the ongoing requirement to reinvest in specialized medical facilities to maintain its competitive position in the post-acute care market.
The persistent need for capital investment to support facility maintenance and equipment upgrades limits the company's financial flexibility, especially when operating cash flow is under pressure. This capital intensity suggests that the company must maintain high occupancy levels just to cover the baseline cost of its physical infrastructure.
Based on reported figures, Select Medical has continued to prioritize share repurchases and dividends despite periods of negative free cash flow, such as the $86.2 million spent on buybacks in 2025Q2, which may indicate an aggressive approach to capital return that risks depleting internal liquidity buffers.
The decision to return capital to shareholders during periods of cash flow volatility appears to prioritize market sentiment over balance sheet preservation. Investors should monitor whether this deployment strategy remains sustainable if clinical labor costs continue to erode the company's thin net margins.
Quick answers to the most common questions about buying SEM stock.
Select Medical Holdings Corporation (SEM) generated $346.5M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Select Medical Holdings Corporation (SEM) generated $382.7M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Select Medical Holdings Corporation (SEM) spent $36.3M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, Select Medical Holdings Corporation (SEM) returned $31.4M to shareholders via cash dividends and spent $100.1M on share repurchases. This shows the company's commitment to returning capital to its equity investors.