ENCOMPASS HEALTH CORP (EHC) Stock Fundamental Analysis

USA • New York Stock Exchange • NYSE:EHC • US29261A1007

97.72 USD
+3.36 (+3.56%)
Last: Feb 4, 2026, 01:39 PM
Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to EHC. 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.


Dividend Valuation Growth Profitability Health

9

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.
  • EHC had a positive operating cash flow in each of the past 5 years.
EHC Yearly Net Income VS EBIT VS OCF VS FCFEHC Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M 800M 1B

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.
  • EHC's Return On Equity of 22.71% is amongst the best of the industry. EHC outperforms 90.20% of its industry peers.
  • EHC's Return On Invested Capital of 12.98% is amongst the best of the industry. EHC outperforms 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 9.16%.
  • 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 RankSector 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%
EHC Yearly ROA, ROE, ROICEHC Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 10 20 30

1.3 Margins

  • EHC has a better Profit Margin (9.30%) than 92.16% of its industry peers.
  • In the last couple of years the Profit Margin of EHC has grown nicely.
  • With an excellent Operating Margin value of 17.29%, EHC belongs to the best of the industry, outperforming 95.10% of the companies in the same industry.
  • In the last couple of years the Operating Margin of EHC has remained more or less at the same level.
  • EHC has a better Gross Margin (95.65%) than 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 RankSector 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%
EHC Yearly Profit, Operating, Gross MarginsEHC Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 20 40 60 80

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4

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.
  • Compared to 1 year ago, EHC has more shares outstanding
  • EHC has more shares outstanding than it did 5 years ago.
  • EHC has a better debt/assets ratio than last year.
EHC Yearly Shares OutstandingEHC Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 20M 40M 60M 80M 100M
EHC Yearly Total Debt VS Total AssetsEHC Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B

2.2 Solvency

  • EHC has an Altman-Z score of 2.85. This is not the best score and indicates that EHC is in the grey zone with still only limited risk for bankruptcy at the moment.
  • EHC has a better Altman-Z score (2.85) than 61.76% of its industry peers.
  • 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.
  • With a decent Debt to FCF ratio value of 6.04, EHC is doing good in the industry, outperforming 61.76% of the companies in the same industry.
  • 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 60.78% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 1.01
Debt/FCF 6.04
Altman-Z 2.85
ROIC/WACC1.48
WACC8.75%
EHC Yearly LT Debt VS Equity VS FCFEHC Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B

2.3 Liquidity

  • A Current Ratio of 1.14 indicates that EHC should not have too much problems paying its short term obligations.
  • EHC has a worse Current ratio (1.14) than 60.78% of its industry peers.
  • A Quick Ratio of 1.14 indicates that EHC should not have too much problems paying its short term obligations.
  • EHC has a Quick ratio (1.14) which is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 1.14
Quick Ratio 1.14
EHC Yearly Current Assets VS Current LiabilitesEHC Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M 800M

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6

3. Growth

3.1 Past

  • EHC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 22.80%, which is quite impressive.
  • The Earnings Per Share has been growing slightly by 2.58% on average over the past years.
  • The Revenue has grown by 11.13% in the past year. This is quite good.
  • The Revenue has been growing slightly by 3.13% on average over the past years.
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 Y20.91%
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

  • The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
  • 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.
EHC Yearly Revenue VS EstimatesEHC Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2B 4B 6B
EHC Yearly EPS VS EstimatesEHC Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2 4 6

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6

4. Valuation

4.1 Price/Earnings Ratio

  • EHC is valuated rather expensively with a Price/Earnings ratio of 18.90.
  • Compared to the rest of the industry, the Price/Earnings ratio of EHC indicates a somewhat cheap valuation: EHC is cheaper than 72.55% of the companies listed in the same industry.
  • When comparing the Price/Earnings ratio of EHC to the average of the S&P500 Index (28.18), we can say EHC is valued slightly cheaper.
  • With a Price/Forward Earnings ratio of 16.65, EHC is valued correctly.
  • Based on the Price/Forward Earnings ratio, EHC is valued a bit cheaper than the industry average as 74.51% of the companies are valued more expensively.
  • EHC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.51, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 18.9
Fwd PE 16.65
EHC Price Earnings VS Forward Price EarningsEHC Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

  • EHC's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. EHC is cheaper than 74.51% of the companies in the same industry.
  • 60.78% of the companies in the same industry are more expensive than EHC, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 24.42
EV/EBITDA 8.94
EHC Per share dataEHC EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 10 20 30 40 50

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)0.9
PEG (5Y)7.32
EPS Next 2Y15.1%
EPS Next 3Y12.88%

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4

5. Dividend

5.1 Amount

  • With a yearly dividend of 0.80%, EHC is not a good candidate for dividend investing.
  • Compared to an average industry Dividend Yield of 0.47, EHC pays a better dividend. On top of this EHC pays more dividend than 84.31% of the companies listed in the same industry.
  • With a Dividend Yield of 0.80, EHC pays less dividend than the S&P500 average, which is at 1.83.
Industry RankSector Rank
Dividend Yield 0.8%

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.
  • EHC has decreased its dividend recently.
Dividend Growth(5Y)-10.71%
Div Incr Years1
Div Non Decr Years1
EHC Yearly Dividends per shareEHC Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0.2 0.4 0.6 0.8 1

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%
EHC Yearly Income VS Free CF VS DividendEHC Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M
EHC Dividend Payout.EHC Dividend Payout, showing the Payout Ratio.EHC Dividend Payout.PayoutRetained Earnings

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ENCOMPASS HEALTH CORP

NYSE:EHC (2/4/2026, 1:39:40 PM)

97.72

+3.36 (+3.56%)

Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)10-29
Earnings (Next)02-05
Inst Owners97.62%
Inst Owner Change-0.39%
Ins Owners1.23%
Ins Owner Change0.04%
Market Cap9.83B
Revenue(TTM)5.80B
Net Income(TTM)539.10M
Analysts87.5
Price Target143.14 (46.48%)
Short Float %3.51%
Short Ratio3.39
Dividend
Industry RankSector Rank
Dividend Yield 0.8%
Yearly Dividend0.62
Dividend Growth(5Y)-10.71%
DP12.82%
Div Incr Years1
Div Non Decr Years1
Ex-Date01-02
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)0.9%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.65%
EPS NY rev (1m)0%
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 RankSector Rank
PE 18.9
Fwd PE 16.65
P/S 1.7
P/FCF 24.42
P/OCF 8.87
P/B 4.14
P/tB 12.62
EV/EBITDA 8.94
EPS(TTM)5.17
EY5.29%
EPS(NY)5.87
Fwd EY6.01%
FCF(TTM)4
FCFY4.09%
OCF(TTM)11.02
OCFY11.27%
SpS57.6
BVpS23.59
TBVpS7.74
PEG (NY)0.9
PEG (5Y)7.32
Graham Number52.39
Profitability
Industry RankSector 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 RankSector 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 2.85
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 Y20.91%
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 3Y21.67%
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 6 / 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%.