ENCOMPASS HEALTH CORP (EHC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:EHC - US29261A1007 - Common Stock
100.5 USD
-2.3 (-2.24%)
100.5 USD
0 (0%)
Overall EHC gets a fundamental rating of 6 out of 10. We evaluated EHC against 102 industry peers in the Health Care Providers & Services industry. EHC has an excellent profitability rating, but 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.
- EHC had a positive operating cash flow in the past year.
- EHC had positive earnings in each of the past 5 years.
- Each year in the past 5 years EHC had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of EHC (7.85%) is better than 91.18% of its industry peers.
- EHC has a Return On Equity of 22.71%. This is amongst the best in the industry. EHC outperforms 90.20% of its industry peers.
- With an excellent Return On Invested Capital value of 12.98%, EHC belongs to the best of the industry, outperforming 88.24% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for EHC is in line with the industry average of 9.21%.
- The last Return On Invested Capital (12.98%) for EHC is above the 3 year average (10.83%), which is a sign of increasing profitability.
| 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
- EHC has a better Profit Margin (9.30%) than 93.14% of its industry peers.
- EHC's Profit Margin has improved in the last couple of years.
- EHC has a Operating Margin of 17.29%. This is amongst the best in the industry. EHC outperforms 95.10% of its industry peers.
- EHC's Operating Margin has been stable in the last couple of years.
- EHC's Gross Margin of 95.65% is amongst the best of the industry. EHC outperforms 99.02% of its industry peers.
- In the last couple of years the Gross Margin of EHC has remained more or less at the same level.
| 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
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), EHC is creating some value.
- EHC has more shares outstanding than it did 1 year ago.
- The number of shares outstanding for EHC has been increased compared to 5 years ago.
- EHC has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.93 indicates that EHC is not a great score, but indicates only limited risk for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 2.93, EHC is in the better half of the industry, outperforming 63.73% of the companies in the same industry.
- The Debt to FCF ratio of EHC is 6.04, which is on the high side as it means it would take EHC, 6.04 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 6.04, EHC is in the better half of the industry, outperforming 60.78% of the companies in the same industry.
- EHC has a Debt/Equity ratio of 1.01. This is a high value indicating a heavy dependency on external financing.
- The Debt to Equity ratio of EHC (1.01) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 6.04 | ||
| Altman-Z | 2.93 |
ROIC/WACC1.48
WACC8.76%
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 Current ratio of 1.14. This is comparable to the rest of the industry: EHC outperforms 40.20% 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 in line with its industry peers.
| 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
- Based on estimates for the next years, EHC will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.24% on average per year.
- 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 Y20.91%
EPS Next 2Y15.1%
EPS Next 3Y12.88%
EPS Next 5Y12.24%
Revenue Next Year10.92%
Revenue Next 2Y9.83%
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
- A Price/Earnings ratio of 19.44 indicates a rather expensive valuation of EHC.
- EHC's Price/Earnings ratio is a bit cheaper when compared to the industry. EHC is cheaper than 73.53% of the companies in the same industry.
- EHC is valuated rather cheaply when we compare the Price/Earnings ratio to 27.38, which is the current average of the S&P500 Index.
- With a Price/Forward Earnings ratio of 17.12, EHC is valued on the expensive side.
- Based on the Price/Forward Earnings ratio, EHC is valued a bit cheaper than 74.51% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of EHC to the average of the S&P500 Index (24.29), we can say EHC is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.44 | ||
| Fwd PE | 17.12 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, EHC is valued a bit cheaper than 74.51% of the companies in the same industry.
- The rest of the industry has a similar Price/Free Cash Flow ratio as EHC.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.12 | ||
| EV/EBITDA | 9.4 |
4.3 Compensation for Growth
- EHC's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- EHC has an outstanding profitability rating, which 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)0.93
PEG (5Y)7.53
EPS Next 2Y15.1%
EPS Next 3Y12.88%
5. Dividend
5.1 Amount
- EHC has a yearly dividend return of 0.74%, which is pretty low.
- EHC's Dividend Yield is rather good when compared to the industry average which is at 0.59. EHC pays more dividend than 84.31% of the companies in the same industry.
- With a Dividend Yield of 0.74, EHC pays less dividend than the S&P500 average, which is at 1.84.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.74% |
5.2 History
- The dividend of EHC decreases each year by -10.71%.
- EHC has been paying a dividend for at least 10 years, so it has 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
- EHC pays out 12.82% of its income as dividend. This is a sustainable payout ratio.
DP12.82%
EPS Next 2Y15.1%
EPS Next 3Y12.88%
100.5
-2.3 (-2.24%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)10-29 2025-10-29/amc
Earnings (Next)02-05 2026-02-05/amc
Inst Owners97.62%
Inst Owner Change0.97%
Ins Owners1.23%
Ins Owner Change0.04%
Market Cap10.11B
Revenue(TTM)5.80B
Net Income(TTM)539.10M
Analysts87.5
Price Target143.14 (42.43%)
Short Float %2.94%
Short Ratio3.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.74% |
Yearly Dividend0.62
Dividend Growth(5Y)-10.71%
DP12.82%
Div Incr Years1
Div Non Decr Years1
Ex-Date01-02 2026-01-02 (0.19)
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%
PT rev (3m)2.12%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.4%
EPS NY rev (1m)0.07%
EPS NY rev (3m)0.45%
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 | 19.44 | ||
| Fwd PE | 17.12 | ||
| P/S | 1.74 | ||
| P/FCF | 25.12 | ||
| P/OCF | 9.12 | ||
| P/B | 4.26 | ||
| P/tB | 12.98 | ||
| EV/EBITDA | 9.4 |
EPS(TTM)5.17
EY5.14%
EPS(NY)5.87
Fwd EY5.84%
FCF(TTM)4
FCFY3.98%
OCF(TTM)11.02
OCFY10.96%
SpS57.6
BVpS23.59
TBVpS7.74
PEG (NY)0.93
PEG (5Y)7.53
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 | 2.93 |
F-Score9
WACC8.76%
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 Y20.91%
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 2Y9.83%
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.
What is the valuation status for EHC stock?
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 financial health of ENCOMPASS HEALTH CORP (EHC) stock?
The financial health rating of ENCOMPASS HEALTH CORP (EHC) is 4 / 10.
Is the dividend of ENCOMPASS HEALTH CORP sustainable?
The dividend rating of ENCOMPASS HEALTH CORP (EHC) is 4 / 10 and the dividend payout ratio is 12.82%.