Physical therapy practice acquisitions have seen several trends in recent years, driven by various factors such as changes in healthcare regulations, market dynamics, and evolving patient needs. Select Medical Holdings Corporation (SEM) is one of the largest providers of specialized healthcare services in the United States, operating through various divisions, including Select Physical Therapy. They have a vast network of outpatient rehabilitation clinics across the country. U.S. Physical Therapy, Inc. (USPH) is another publicly traded company that operates outpatient physical therapy clinics under various brands, including BenchMark Physical Therapy, ProActive Physical Therapy & Sports Medicine, and others.
The subsequent table details some historical multiples for these two companies. Recent trends show fluctuations in both the price-to-revenue and price-to-EBITDA multiples.

USPH has also been engaged in several acquisitions over the last couple of years. Reported transactions from 2022 through 2024 show an average price-to-revenue multiple of 1.63x and a median of 1.68x. Physical therapy transaction data from DealStats shows a median price-to-EBITDA multiple of 2.33x and a price-to-revenue multiple of 0.56x.

Some recent trends in physical therapy practice acquisitions include:

  • Consolidation: There has been a trend toward consolidation in the physical therapy industry, with larger healthcare organizations acquiring smaller, independent practices. This consolidation allows for economies of scale, improved operational efficiency, and broader geographic coverage.
  • Private Equity Investment: Private equity firms have shown increasing interest in the physical therapy sector, investing in both individual practices and larger multi-site organizations. This investment can provide capital for growth, operational expertise, and support for acquisitions.
  • Integration with Healthcare Systems: Physical therapy practices are increasingly being integrated into larger healthcare systems. This integration can lead to better coordination of care, increased access to resources and referrals, and improved patient outcomes.
  • Focus on Outcomes and Value-Based Care: With a shift towards value-based care, acquiring practices are placing greater emphasis on patient outcomes, satisfaction, and cost-effectiveness. Practices that demonstrate strong clinical outcomes and efficient delivery of care may be more attractive acquisition targets.
  • Regional Expansion: Acquiring practices often seek to expand their geographic footprint by acquiring practices in new markets or regions. This expansion allows them to capture a larger share of the market and leverage economies of scale.

These trends reflect the evolving landscape of the physical therapy industry, driven by changes in healthcare delivery, patient preferences, and market dynamics. The market’s highly fragmented nature shows the continual efforts by large and smaller players to strengthen their foothold, and we expect to see continued consolidation and acquisition activity in this space.
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