Encompass Health Corporation

Valuation Analysis

About the Company

Encompass Health Corporation operates inpatient rehabilitation hospitals in the United States and Puerto Rico. The company offers specialized rehabilitative treatment, using technology and therapy, on an inpatient basis for patients recovering from a major injury or illness and seeking to regain functional ability, independence, and quality of life; medical, nursing, therapy, and ancillary services; and rehabilitative care to patients who are recovering from conditions, such as stroke and other neurological disorders, cardiac and pulmonary conditions, brain and spinal cord injuries, complex orthopedic conditions, and amputations. It offers services through the Medicare program to the federal government, managed care plans and private insurers, state governments, and other patients. The com

Encompass Health Corporation Stock at a Glance

Encompass Health Corporation (EHC) is currently trading at $101.47 with a market capitalization of $10.1B. The trailing P/E ratio stands at 17.38x, with a forward P/E of 15.52x. The 52-week range spans from $92.77 to $127.99; the current price is 20.7% below the yearly high. Year-over-year revenue growth stands at +9.0%. The net profit margin stands at 10.04%.

💰 Dividend

Encompass Health Corporation pays an annual dividend of $0.76 per share, representing a yield of 0.75%. The payout ratio stands at 12.67%.

📊 Analyst Rating

12 analysts rate Encompass Health Corporation (EHC) on consensus: Strong Buy. The average price target is $140.50, implying +38.46% from the current price. Analyst price targets range from $125.00 to $152.00.

Encompass Health Corporation: The Investment Case in Detail

Encompass Health Corporation (EHC) operates in the Healthcare — specifically Medical Care Facilities — and is headquartered in United States. Below is a structured read of the investment case built directly from the latest fundamentals, valuation multiples, analyst positioning and smart-money flows. Each section translates raw numbers into the investment logic they imply, so you can decide whether the risk/reward fits your portfolio.

The Bull Case

Earnings growth of 30.3% is outpacing revenue, a sign of operational leverage — fixed costs are being absorbed across a larger base. The combination of a 43.49% gross margin and 19.01% operating margin shows the business converts revenue into profit efficiently — a hallmark of competitive moat. Return on equity of 25.23% places management among the most capital-efficient operators in the public market — every euro of shareholder capital is working hard.

Valuation in Context

With a PEG ratio of 0.41, the price-to-earnings multiple is actually below the company's growth rate — classic value-meets-growth territory that Peter Lynch would have called a 'GARP' opportunity. The EV/EBITDA multiple of 9.55x is below the historical equity-market average — strategic acquirers would find the cash-flow profile attractive at this level.

What to Watch Next

• The forward P/E of 15.52x is meaningfully below the trailing 17.38x — analysts expect earnings to step up; the next earnings release is the test.
• The price sits in the lower quartile of the 52-week range — value hunters often start scaling in around this zone if fundamentals hold.
• The analyst consensus price target implies 38.46% upside — if the next two quarters confirm the underlying thesis, target hikes typically follow.

Investment Thesis: Strengths & Weaknesses

Technical Snapshot

Price is below both the 50- and 200-day moving averages, with 50d below 200d — a bearish picture (death-cross alignment).

Risk Profile

The data points to relatively defensive market behavior.

Trading Data

💵 Dividend Info

Related Stocks in the Same Sector

Where can I buy Encompass Health Corporation?

Compare top-rated brokers — low fees, trusted providers, fully regulated.