ENCOMPASS HEALTH CORP (EHC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:EHC - US29261A1007 - Common Stock
107.52 USD
+0.41 (+0.38%)
107.52 USD
0 (0%)
Taking everything into account, EHC scores 6 out of 10 in our fundamental rating. EHC was compared to 102 industry peers in the Health Care Providers & Services industry. While EHC belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. EHC has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
EHC had positive earnings in the past year.
In the past year EHC had a positive cash flow from operations.
EHC had positive earnings in each of the past 5 years.
In the past 5 years EHC always reported a positive cash flow from operatings.
1.2 Ratios
EHC has a Return On Assets of 7.85%. This is amongst the best in the industry. EHC outperforms 90.20% of its industry peers.
The Return On Equity of EHC (22.71%) is better than 89.22% of its industry peers.
EHC has a better Return On Invested Capital (12.98%) than 88.24% of its industry peers.
EHC had an Average Return On Invested Capital over the past 3 years of 10.83%. This is in line with the industry average of 9.61%.
The 3 year average ROIC (10.83%) for EHC is below the current ROIC(12.98%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.85% | ||
| ROE | 22.71% | ||
| ROIC | 12.98% |
ROA(3y)5.82%
ROA(5y)5.56%
ROE(3y)21.24%
ROE(5y)20.61%
ROIC(3y)10.83%
ROIC(5y)9.67%
1.3 Margins
Looking at the Profit Margin, with a value of 9.30%, EHC belongs to the top of the industry, outperforming 92.16% of the companies in the same industry.
EHC's Profit Margin has improved in the last couple of years.
EHC has a better Operating Margin (17.29%) than 94.12% of its industry peers.
EHC's Operating Margin has been stable in the last couple of years.
The Gross Margin of EHC (95.65%) is better than 99.02% of its industry peers.
EHC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.29% | ||
| PM (TTM) | 9.3% | ||
| GM | 95.65% |
OM growth 3Y-0.68%
OM growth 5Y1.36%
PM growth 3Y-6.23%
PM growth 5Y1.66%
GM growth 3Y0.05%
GM growth 5Y-0.17%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so EHC is still creating some value.
The number of shares outstanding for EHC has been increased compared to 1 year ago.
EHC has more shares outstanding than it did 5 years ago.
The debt/assets ratio for EHC has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.02 indicates that EHC is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.02, EHC is in the better half of the industry, outperforming 62.75% of the companies in the same industry.
EHC has a debt to FCF ratio of 6.04. This is a slightly negative value and a sign of low solvency as EHC would need 6.04 years to pay back of all of its debts.
EHC has a better Debt to FCF ratio (6.04) than 60.78% of its industry peers.
A Debt/Equity ratio of 1.01 is on the high side and indicates that EHC has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.01, EHC is doing worse than 61.76% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 6.04 | ||
| Altman-Z | 3.02 |
ROIC/WACC1.48
WACC8.75%
2.3 Liquidity
EHC has a Current Ratio of 1.14. This is a normal value and indicates that EHC is financially healthy and should not expect problems in meeting its short term obligations.
EHC has a worse Current ratio (1.14) than 61.76% of its industry peers.
EHC has a Quick Ratio of 1.14. This is a normal value and indicates that EHC is financially healthy and should not expect problems in meeting its short term obligations.
EHC has a Quick ratio (1.14) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.14 | ||
| Quick Ratio | 1.14 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 22.80% over the past year.
EHC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.58% yearly.
Looking at the last year, EHC shows a quite strong growth in Revenue. The Revenue has grown by 11.13% in the last year.
EHC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.13% yearly.
EPS 1Y (TTM)22.8%
EPS 3Y1.63%
EPS 5Y2.58%
EPS Q2Q%19.42%
Revenue 1Y (TTM)11.13%
Revenue growth 3Y10.2%
Revenue growth 5Y3.13%
Sales Q2Q%9.36%
3.2 Future
The Earnings Per Share is expected to grow by 12.24% on average over the next years. This is quite good.
Based on estimates for the next years, EHC will show a quite strong growth in Revenue. The Revenue will grow by 8.33% on average per year.
EPS Next Y20.82%
EPS Next 2Y15.1%
EPS Next 3Y12.88%
EPS Next 5Y12.24%
Revenue Next Year10.92%
Revenue Next 2Y9.84%
Revenue Next 3Y9.27%
Revenue Next 5Y8.33%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
EHC is valuated rather expensively with a Price/Earnings ratio of 20.80.
Based on the Price/Earnings ratio, EHC is valued a bit cheaper than 69.61% of the companies in the same industry.
EHC's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.57.
The Price/Forward Earnings ratio is 18.32, which indicates a rather expensive current valuation of EHC.
Based on the Price/Forward Earnings ratio, EHC is valued a bit cheaper than the industry average as 67.65% of the companies are valued more expensively.
EHC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.04, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.8 | ||
| Fwd PE | 18.32 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EHC indicates a somewhat cheap valuation: EHC is cheaper than 74.51% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of EHC is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.87 | ||
| EV/EBITDA | 9.91 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of EHC may justify a higher PE ratio.
EHC's earnings are expected to grow with 12.88% in the coming years. This may justify a more expensive valuation.
PEG (NY)1
PEG (5Y)8.06
EPS Next 2Y15.1%
EPS Next 3Y12.88%
5. Dividend
5.1 Amount
With a yearly dividend of 0.71%, EHC is not a good candidate for dividend investing.
EHC's Dividend Yield is rather good when compared to the industry average which is at 0.58. EHC pays more dividend than 84.31% of the companies in the same industry.
With a Dividend Yield of 0.71, EHC pays less dividend than the S&P500 average, which is at 1.88.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.71% |
5.2 History
The dividend of EHC decreases each year by -10.71%.
EHC has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of EHC decreased recently.
Dividend Growth(5Y)-10.71%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
12.82% of the earnings are spent on dividend by EHC. This is a low number and sustainable payout ratio.
DP12.82%
EPS Next 2Y15.1%
EPS Next 3Y12.88%
107.52
+0.41 (+0.38%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners97.58%
Inst Owner Change1.4%
Ins Owners1.23%
Ins Owner Change-0.01%
Market Cap10.82B
Revenue(TTM)5.80B
Net Income(TTM)539.10M
Analysts87.06
Price TargetN/A
Short Float %2.58%
Short Ratio3.07
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.71% |
Yearly Dividend0.62
Dividend Growth(5Y)-10.71%
DP12.82%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.29%
Min EPS beat(2)1.94%
Max EPS beat(2)14.64%
EPS beat(4)4
Avg EPS beat(4)10.91%
Min EPS beat(4)1.94%
Max EPS beat(4)14.64%
EPS beat(8)8
Avg EPS beat(8)11.75%
EPS beat(12)12
Avg EPS beat(12)13.3%
EPS beat(16)14
Avg EPS beat(16)9.44%
Revenue beat(2)1
Avg Revenue beat(2)-0.01%
Min Revenue beat(2)-1.17%
Max Revenue beat(2)1.16%
Revenue beat(4)3
Avg Revenue beat(4)0.37%
Min Revenue beat(4)-1.17%
Max Revenue beat(4)1.16%
Revenue beat(8)5
Avg Revenue beat(8)0.39%
Revenue beat(12)9
Avg Revenue beat(12)0.44%
Revenue beat(16)10
Avg Revenue beat(16)-3.55%
PT rev (1m)0.9%
PT rev (3m)2.43%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.4%
EPS NY rev (1m)0.05%
EPS NY rev (3m)1.28%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.06%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.8 | ||
| Fwd PE | 18.32 | ||
| P/S | 1.87 | ||
| P/FCF | 26.87 | ||
| P/OCF | 9.76 | ||
| P/B | 4.56 | ||
| P/tB | 13.89 | ||
| EV/EBITDA | 9.91 |
EPS(TTM)5.17
EY4.81%
EPS(NY)5.87
Fwd EY5.46%
FCF(TTM)4
FCFY3.72%
OCF(TTM)11.02
OCFY10.25%
SpS57.6
BVpS23.59
TBVpS7.74
PEG (NY)1
PEG (5Y)8.06
Graham Number52.39
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.85% | ||
| ROE | 22.71% | ||
| ROCE | 16.42% | ||
| ROIC | 12.98% | ||
| ROICexc | 13.16% | ||
| ROICexgc | 17.91% | ||
| OM | 17.29% | ||
| PM (TTM) | 9.3% | ||
| GM | 95.65% | ||
| FCFM | 6.95% |
ROA(3y)5.82%
ROA(5y)5.56%
ROE(3y)21.24%
ROE(5y)20.61%
ROIC(3y)10.83%
ROIC(5y)9.67%
ROICexc(3y)10.95%
ROICexc(5y)9.82%
ROICexgc(3y)15.47%
ROICexgc(5y)15.57%
ROCE(3y)13.69%
ROCE(5y)12.22%
ROICexgc growth 3Y1.55%
ROICexgc growth 5Y-5.09%
ROICexc growth 3Y12.32%
ROICexc growth 5Y3.22%
OM growth 3Y-0.68%
OM growth 5Y1.36%
PM growth 3Y-6.23%
PM growth 5Y1.66%
GM growth 3Y0.05%
GM growth 5Y-0.17%
F-Score9
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 6.04 | ||
| Debt/EBITDA | 1.81 | ||
| Cap/Depr | 220.91% | ||
| Cap/Sales | 12.18% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.87% | ||
| Profit Quality | 74.68% | ||
| Current Ratio | 1.14 | ||
| Quick Ratio | 1.14 | ||
| Altman-Z | 3.02 |
F-Score9
WACC8.75%
ROIC/WACC1.48
Cap/Depr(3y)222.37%
Cap/Depr(5y)209.98%
Cap/Sales(3y)12.51%
Cap/Sales(5y)12.54%
Profit Quality(3y)67.08%
Profit Quality(5y)69.21%
High Growth Momentum
Growth
EPS 1Y (TTM)22.8%
EPS 3Y1.63%
EPS 5Y2.58%
EPS Q2Q%19.42%
EPS Next Y20.82%
EPS Next 2Y15.1%
EPS Next 3Y12.88%
EPS Next 5Y12.24%
Revenue 1Y (TTM)11.13%
Revenue growth 3Y10.2%
Revenue growth 5Y3.13%
Sales Q2Q%9.36%
Revenue Next Year10.92%
Revenue Next 2Y9.84%
Revenue Next 3Y9.27%
Revenue Next 5Y8.33%
EBIT growth 1Y21.88%
EBIT growth 3Y9.45%
EBIT growth 5Y4.54%
EBIT Next Year52.35%
EBIT Next 3Y21.51%
EBIT Next 5YN/A
FCF growth 1Y54.97%
FCF growth 3Y29.84%
FCF growth 5Y9.28%
OCF growth 1Y34.84%
OCF growth 3Y11.89%
OCF growth 5Y9.56%
ENCOMPASS HEALTH CORP / EHC FAQ
What is the fundamental rating for EHC stock?
ChartMill assigns a fundamental rating of 6 / 10 to EHC.
Can you provide the valuation status for ENCOMPASS HEALTH CORP?
ChartMill assigns a valuation rating of 5 / 10 to ENCOMPASS HEALTH CORP (EHC). This can be considered as Fairly Valued.
Can you provide the profitability details for ENCOMPASS HEALTH CORP?
ENCOMPASS HEALTH CORP (EHC) has a profitability rating of 9 / 10.
What is the earnings growth outlook for ENCOMPASS HEALTH CORP?
The Earnings per Share (EPS) of ENCOMPASS HEALTH CORP (EHC) is expected to grow by 20.82% in the next year.
How sustainable is the dividend of ENCOMPASS HEALTH CORP (EHC) stock?
The dividend rating of ENCOMPASS HEALTH CORP (EHC) is 4 / 10 and the dividend payout ratio is 12.82%.