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 100 industry peers in the Health Care Providers & Services industry. While EHC belongs to the best of the industry regarding profitability, there are concerns on its financial health. EHC is not valued too expensively and it also shows a decent growth rate.
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.
- In the past 5 years EHC has always been profitable.
- In the past 5 years EHC always reported a positive cash flow from operatings.
1.2 Ratios
- With an excellent Return On Assets value of 7.85%, EHC belongs to the best of the industry, outperforming 91.00% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 22.71%, EHC belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 12.98%, EHC belongs to the top of the industry, outperforming 88.00% of the companies in the same industry.
- 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 9.19%.
- 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 93.00% of the companies in the same industry.
- EHC's Profit Margin has improved in the last couple of years.
- With an excellent Operating Margin value of 17.29%, EHC belongs to the best of the industry, outperforming 95.00% of the companies in the same industry.
- EHC's Operating Margin has been stable in the last couple of years.
- EHC has a Gross Margin of 95.65%. This is amongst the best in the industry. EHC outperforms 99.00% 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
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), EHC is creating some value.
- The number of shares outstanding for EHC has been increased compared to 1 year ago.
- Compared to 5 years ago, EHC has more shares outstanding
- The debt/assets ratio for EHC has been reduced compared to a year ago.
2.2 Solvency
- EHC has an Altman-Z score of 2.96. 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.
- With a decent Altman-Z score value of 2.96, EHC is doing good in the industry, outperforming 63.00% 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 Debt to FCF ratio (6.04) which is comparable to the rest of the industry.
- EHC has a Debt/Equity ratio of 1.01. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 1.01, EHC is not doing good in the industry: 61.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 6.04 | ||
| Altman-Z | 2.96 |
ROIC/WACC1.48
WACC8.8%
2.3 Liquidity
- A Current Ratio of 1.14 indicates that EHC should not have too much problems paying its short term obligations.
- Looking at the Current ratio, with a value of 1.14, EHC is doing worse than 62.00% of the companies in the same industry.
- 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 of 1.14. This is comparable to the rest of the industry: EHC outperforms 45.00% of 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.
- 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.
- EHC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.33% yearly.
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
- Based on the Price/Earnings ratio of 19.44, the valuation of EHC can be described as rather expensive.
- EHC's Price/Earnings ratio is a bit cheaper when compared to the industry. EHC is cheaper than 75.00% 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 27.47.
- Based on the Price/Forward Earnings ratio of 17.12, the valuation of EHC can be described as rather expensive.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of EHC indicates a somewhat cheap valuation: EHC is cheaper than 75.00% of the companies listed in the same industry.
- EHC's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.26.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.44 | ||
| Fwd PE | 17.12 |
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 76.00% of the companies listed in the same industry.
- EHC's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.12 | ||
| EV/EBITDA | 9.58 |
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)0.93
PEG (5Y)7.53
EPS Next 2Y15.1%
EPS Next 3Y12.88%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.72%, EHC is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 0.59, EHC pays a better dividend. On top of this EHC pays more dividend than 84.00% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.89, EHC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.72% |
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
- 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 Change0.61%
Ins Owners1.23%
Ins Owner Change-0.01%
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 | 0.72% |
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 | 9.58 |
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 | 2.96 |
F-Score9
WACC8.8%
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 3 / 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%.