Encompass Health Corporation (NYSE:EHC) Receives Average Rating of "Buy" from Brokerages

Key Points

• Analyst sentiment is positive: Seven brokerages give Encompass Health an average “Buy” rating, with an average 12-month price target of $148.20 versus a recent share price of $124.05.
• Recent results exceeded expectations: The company reported quarterly EPS of $1.55, beating estimates of $1.48, while revenue rose 9.6% year over year to $1.60 billion.
• The dividend increased: Encompass Health raised its quarterly dividend from $0.19 to $0.21 per share, equivalent to an annualized $0.84 dividend and a 0.7% yield.

Shares of Encompass Health Corporation (NYSE:EHC - Get Free Report) have earned an average recommendation of "Buy" from the seven brokerages that are currently covering the company, Marketbeat.com reports. One investment analyst has rated the stock with a hold recommendation, five have given a buy recommendation and one has assigned a strong buy recommendation to the company. The average 1-year price objective among brokerages that have issued ratings on the stock in the last year is $148.20.

Several brokerages recently commented on EHC. Leerink Partners set a $152.00 price objective on shares of Encompass Health in a research report on Friday, May 22nd. Wall Street Zen downgraded shares of Encompass Health from a "buy" rating to a "hold" rating in a research note on Saturday, September 5th. UBS Group raised their price target on shares of Encompass Health from $150.00 to $155.00 and gave the company a "buy" rating in a research report on Friday, August 7th. Truist Financial boosted their price objective on shares of Encompass Health from $140.00 to $150.00 and gave the stock a "buy" rating in a report on Friday, August 7th. Finally, TD Cowen increased their target price on Encompass Health from $125.00 to $140.00 and gave the company a "buy" rating in a research note on Monday, August 10th.

Encompass Health Price Performance

Shares of Encompass Health stock opened at $124.05 on Thursday. The company has a debt-to-equity ratio of 0.76, a current ratio of 1.19 and a quick ratio of 1.19. Encompass Health has a one year low of $92.77 and a one year high of $127.99. The business's 50 day simple moving average is $117.95 and its two-hundred day simple moving average is $108.40. The stock has a market capitalization of $12.24 billion, a P/E ratio of 20.20, a price-to-earnings-growth ratio of 2.47 and a beta of 0.75.

Encompass Health (NYSE:EHC - Get Free Report) last issued its quarterly earnings data on Wednesday, August 5th. The company reported $1.55 earnings per share for the quarter, topping analysts' consensus estimates of $1.48 by $0.07. Encompass Health had a return on equity of 18.08% and a net margin of 10.01%.The firm had revenue of $1.60 billion for the quarter, compared to analyst estimates of $1.57 billion. During the same period last year, the company earned $1.40 EPS. The business's quarterly revenue was up 9.6% compared to the same quarter last year. Encompass Health has set its FY 2026 guidance at 6.020-6.250 EPS. Analysts forecast that Encompass Health will post 6.08 EPS for the current year.

Encompass Health Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, October 15th. Stockholders of record on Thursday, October 1st will be issued a dividend of $0.21 per share. This represents a $0.84 annualized dividend and a dividend yield of 0.7%. The ex-dividend date of this dividend is Thursday, October 1st. This is a positive change from Encompass Health's previous quarterly dividend of $0.19. Encompass Health's payout ratio is currently 12.38%.

Insider Activity

In other news, EVP John Darby sold 8,906 shares of the stock in a transaction that occurred on Monday, August 10th. The shares were sold at an average price of $125.95, for a total value of $1,121,710.70. Following the transaction, the executive vice president owned 75,041 shares in the company, valued at $9,451,413.95. This represents a 10.61% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, CEO Mark Tarr sold 173,148 shares of Encompass Health stock in a transaction on Monday, August 10th. The stock was sold at an average price of $125.47, for a total transaction of $21,724,879.56. Following the transaction, the chief executive officer owned 267,814 shares in the company, valued at $33,602,622.58. This represents a 39.27% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 186,912 shares of company stock worth $23,434,845 over the last three months. Insiders own 1.80% of the company's stock.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. BlackRock Inc. bought a new position in shares of Encompass Health during the 2nd quarter valued at approximately $1,059,762,000. Geode Capital Management LLC increased its position in Encompass Health by 7.6% in the fourth quarter. Geode Capital Management LLC now owns 1,946,134 shares of the company's stock worth $206,605,000 after purchasing an additional 137,892 shares during the last quarter. Dimensional Fund Advisors LP raised its stake in Encompass Health by 3.1% during the first quarter. Dimensional Fund Advisors LP now owns 1,674,784 shares of the company's stock valued at $162,013,000 after purchasing an additional 50,647 shares in the last quarter. Norges Bank bought a new position in Encompass Health during the fourth quarter valued at $133,221,000. Finally, Arrowstreet Capital Limited Partnership grew its stake in shares of Encompass Health by 1.6% in the 1st quarter. Arrowstreet Capital Limited Partnership now owns 1,182,574 shares of the company's stock worth $114,390,000 after buying an additional 18,740 shares in the last quarter. 97.25% of the stock is currently owned by institutional investors.

Encompass Health Company Profile

Encompass Health Corporation NYSE: EHC is a provider of post-acute healthcare services in the United States. The company operates inpatient rehabilitation hospitals that care for patients recovering from illness, injury, surgery or other medical conditions requiring intensive rehabilitation.

Its rehabilitation programs commonly serve patients recovering from strokes, brain and spinal cord injuries, neurological disorders, cardiac and pulmonary conditions, hip fractures, amputations and other orthopedic conditions.

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