ENCOMPASS HEALTH CORP (EHC) Stock Fundamental Analysis
USA - NYSE:EHC - US29261A1007 - Common Stock
115.3 USD
-1.84 (-1.57%)
115.3 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 has a great profitability rating, 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
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.
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 7.67%, EHC belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
With an excellent Return On Equity value of 22.82%, EHC belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
EHC has a better Return On Invested Capital (12.93%) than 89.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for EHC is in line with the industry average of 9.42%.
The 3 year average ROIC (10.83%) for EHC is below the current ROIC(12.93%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.67% | ||
| ROE | 22.82% | ||
| ROIC | 12.93% |
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
With an excellent Profit Margin value of 9.18%, EHC belongs to the best of the industry, outperforming 91.00% of the companies in the same industry.
EHC's Profit Margin has improved in the last couple of years.
The Operating Margin of EHC (17.07%) is better than 94.00% of its industry peers.
EHC's Operating Margin has been stable in the last couple of years.
EHC has a better Gross Margin (95.62%) than 99.00% 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 | 17.07% | ||
| PM (TTM) | 9.18% | ||
| GM | 95.62% |
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
EHC has an Altman-Z score of 3.08. This indicates that EHC is financially healthy and has little risk of bankruptcy at the moment.
EHC has a better Altman-Z score (3.08) than 65.00% of its industry peers.
The Debt to FCF ratio of EHC is 5.60, which is a neutral value as it means it would take EHC, 5.60 years of fcf income to pay off all of its debts.
EHC has a Debt to FCF ratio of 5.60. This is in the better half of the industry: EHC outperforms 61.00% of its industry peers.
EHC has a Debt/Equity ratio of 1.02. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of EHC (1.02) is worse than 62.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 5.6 | ||
| Altman-Z | 3.08 |
ROIC/WACC1.44
WACC8.99%
2.3 Liquidity
EHC has a Current Ratio of 1.06. This is a normal value and indicates that EHC is financially healthy and should not expect problems in meeting its short term obligations.
EHC's Current ratio of 1.06 is on the low side compared to the rest of the industry. EHC is outperformed by 69.00% of its industry peers.
A Quick Ratio of 1.06 indicates that EHC should not have too much problems paying its short term obligations.
EHC has a Quick ratio of 1.06. This is in the lower half of the industry: EHC underperforms 65.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 |
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.
Measured over the past 5 years, EHC shows a small growth in Earnings Per Share. The EPS has been growing by 2.58% on average per year.
The Revenue has grown by 11.91% in the past year. This is quite good.
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)11.91%
Revenue growth 3Y10.2%
Revenue growth 5Y3.13%
Sales Q2Q%9.36%
3.2 Future
EHC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.24% yearly.
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 Y20.76%
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
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.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 22.30 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 64.00% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.13. EHC is around the same levels.
The Price/Forward Earnings ratio is 19.67, which indicates a rather expensive current valuation of EHC.
61.00% of the companies in the same industry are more expensive than EHC, based on the Price/Forward Earnings ratio.
EHC is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.35, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.3 | ||
| Fwd PE | 19.67 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, EHC is valued a bit cheaper than 68.00% of the companies in the same industry.
EHC's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.44 | ||
| EV/EBITDA | 10.89 |
4.3 Compensation for Growth
The 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)1.07
PEG (5Y)8.64
EPS Next 2Y15.03%
EPS Next 3Y12.88%
5. Dividend
5.1 Amount
EHC has a yearly dividend return of 0.66%, which is pretty low.
Compared to an average industry Dividend Yield of 2.49, EHC pays a better dividend. On top of this EHC pays more dividend than 83.00% of the companies listed in the same industry.
With a Dividend Yield of 0.66, EHC pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.66% |
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.
EHC has decreased its dividend recently.
Dividend Growth(5Y)-10.71%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
EHC pays out 12.89% of its income as dividend. This is a sustainable payout ratio.
DP12.89%
EPS Next 2Y15.03%
EPS Next 3Y12.88%
115.3
-1.84 (-1.57%)
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 Change-1.38%
Ins Owners1.24%
Ins Owner Change-0.42%
Market Cap11.61B
Revenue(TTM)5.37B
Net Income(TTM)520.40M
Analysts87.06
Price Target141.87 (23.04%)
Short Float %1.67%
Short Ratio2.7
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.66% |
Yearly Dividend0.62
Dividend Growth(5Y)-10.71%
DP12.89%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)14.38%
Min EPS beat(2)14.11%
Max EPS beat(2)14.64%
EPS beat(4)4
Avg EPS beat(4)12.46%
Min EPS beat(4)8.15%
Max EPS beat(4)14.64%
EPS beat(8)8
Avg EPS beat(8)12.84%
EPS beat(12)12
Avg EPS beat(12)13.47%
EPS beat(16)13
Avg EPS beat(16)9.09%
Revenue beat(2)2
Avg Revenue beat(2)0.97%
Min Revenue beat(2)0.79%
Max Revenue beat(2)1.16%
Revenue beat(4)4
Avg Revenue beat(4)0.85%
Min Revenue beat(4)0.72%
Max Revenue beat(4)1.16%
Revenue beat(8)6
Avg Revenue beat(8)0.55%
Revenue beat(12)10
Avg Revenue beat(12)0.65%
Revenue beat(16)10
Avg Revenue beat(16)-4.97%
PT rev (1m)1.52%
PT rev (3m)5.7%
EPS NQ rev (1m)-0.28%
EPS NQ rev (3m)3.49%
EPS NY rev (1m)0%
EPS NY rev (3m)5.43%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.34%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.74%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.3 | ||
| Fwd PE | 19.67 | ||
| P/S | 2.05 | ||
| P/FCF | 26.44 | ||
| P/OCF | 10.51 | ||
| P/B | 5.09 | ||
| P/tB | 17.05 | ||
| EV/EBITDA | 10.89 |
EPS(TTM)5.17
EY4.48%
EPS(NY)5.86
Fwd EY5.08%
FCF(TTM)4.36
FCFY3.78%
OCF(TTM)10.98
OCFY9.52%
SpS56.29
BVpS22.64
TBVpS6.76
PEG (NY)1.07
PEG (5Y)8.64
Graham Number51.32
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.67% | ||
| ROE | 22.82% | ||
| ROCE | 16.34% | ||
| ROIC | 12.93% | ||
| ROICexc | 13.15% | ||
| ROICexgc | 18.12% | ||
| OM | 17.07% | ||
| PM (TTM) | 9.18% | ||
| GM | 95.62% | ||
| FCFM | 7.75% |
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-Score8
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 5.6 | ||
| Debt/EBITDA | 1.81 | ||
| Cap/Depr | 211.16% | ||
| Cap/Sales | 11.75% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.16% | ||
| Profit Quality | 84.4% | ||
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z | 3.08 |
F-Score8
WACC8.99%
ROIC/WACC1.44
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)11.91%
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 1Y22.1%
EBIT growth 3Y9.45%
EBIT growth 5Y4.54%
EBIT Next Year51.87%
EBIT Next 3Y21.54%
EBIT Next 5YN/A
FCF growth 1Y285.6%
FCF growth 3Y29.84%
FCF growth 5Y9.28%
OCF growth 1Y63.3%
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 12.89%.