ENCOMPASS HEALTH CORP (EHC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:EHC - US29261A1007 - Common Stock
113.025 USD
0.01 (0%)
EHC gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 101 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 correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year EHC was profitable.
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.
1.2 Ratios
With an excellent Return On Assets value of 7.85%, EHC belongs to the best of the industry, outperforming 91.09% of the companies in the same industry.
EHC has a better Return On Equity (22.71%) than 90.10% of its industry peers.
With an excellent Return On Invested Capital value of 12.98%, EHC belongs to the best of the industry, outperforming 90.10% 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 9.22%.
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
EHC's Profit Margin of 9.30% is amongst the best of the industry. EHC outperforms 92.08% 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 94.06% 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 99.01% 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
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.
The debt/assets ratio for EHC has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.10 indicates that EHC is not in any danger for bankruptcy at the moment.
The Altman-Z score of EHC (3.10) is better than 64.36% 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.
EHC has a Debt to FCF ratio of 6.04. This is in the better half of the industry: EHC outperforms 60.40% of its industry peers.
EHC has a Debt/Equity ratio of 1.01. This is a high value indicating a heavy dependency on external financing.
EHC's Debt to Equity ratio of 1.01 is on the low side compared to the rest of the industry. EHC is outperformed by 60.40% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 6.04 | ||
| Altman-Z | 3.1 |
ROIC/WACC1.52
WACC8.57%
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 (1.14) which is comparable to the rest of the industry.
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 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.
EHC shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.13%.
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
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 Y20.76%
EPS Next 2Y15.03%
EPS Next 3Y12.88%
EPS Next 5Y12.24%
Revenue Next Year10.92%
Revenue Next 2Y9.85%
Revenue Next 3Y9.28%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 21.86, EHC is valued on the expensive side.
EHC's Price/Earnings ratio is a bit cheaper when compared to the industry. EHC is cheaper than 65.35% of the companies in the same industry.
When comparing the Price/Earnings ratio of EHC to the average of the S&P500 Index (26.41), we can say EHC is valued inline with the index average.
EHC is valuated rather expensively with a Price/Forward Earnings ratio of 19.28.
EHC's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 35.40. EHC is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.86 | ||
| Fwd PE | 19.28 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, EHC is valued a bit cheaper than 69.31% of the companies in the same industry.
EHC's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.25 | ||
| EV/EBITDA | 10.36 |
4.3 Compensation for Growth
EHC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of EHC may justify a higher PE ratio.
A more expensive valuation may be justified as EHC's earnings are expected to grow with 12.88% in the coming years.
PEG (NY)1.05
PEG (5Y)8.47
EPS Next 2Y15.03%
EPS Next 3Y12.88%
5. Dividend
5.1 Amount
With a yearly dividend of 0.65%, EHC is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.47, EHC pays a better dividend. On top of this EHC pays more dividend than 83.17% of the companies listed in the same industry.
With a Dividend Yield of 0.65, EHC pays less dividend than the S&P500 average, which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.65% |
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
12.82% of the earnings are spent on dividend by EHC. This is a low number and sustainable payout ratio.
DP12.82%
EPS Next 2Y15.03%
EPS Next 3Y12.88%
NYSE:EHC (12/5/2025, 9:57:08 AM)
113.025
0.01 (0%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners95.92%
Inst Owner Change1.39%
Ins Owners1.24%
Ins Owner Change-0.01%
Market Cap11.37B
Revenue(TTM)5.80B
Net Income(TTM)539.10M
Analysts87.06
Price Target143.14 (26.64%)
Short Float %2.67%
Short Ratio3.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.65% |
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)3.38%
EPS NQ rev (1m)-0.65%
EPS NQ rev (3m)-0.2%
EPS NY rev (1m)0.33%
EPS NY rev (3m)1.22%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)0.06%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.86 | ||
| Fwd PE | 19.28 | ||
| P/S | 1.96 | ||
| P/FCF | 28.25 | ||
| P/OCF | 10.26 | ||
| P/B | 4.79 | ||
| P/tB | 14.6 | ||
| EV/EBITDA | 10.36 |
EPS(TTM)5.17
EY4.57%
EPS(NY)5.86
Fwd EY5.19%
FCF(TTM)4
FCFY3.54%
OCF(TTM)11.02
OCFY9.75%
SpS57.6
BVpS23.59
TBVpS7.74
PEG (NY)1.05
PEG (5Y)8.47
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 | 3.1 |
F-Score9
WACC8.57%
ROIC/WACC1.52
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 Y20.76%
EPS Next 2Y15.03%
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 2Y9.85%
Revenue Next 3Y9.28%
Revenue Next 5Y8.33%
EBIT growth 1Y21.88%
EBIT growth 3Y9.45%
EBIT growth 5Y4.54%
EBIT Next Year51.87%
EBIT Next 3Y21.54%
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 4 / 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 20.76% 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%.