Encompass Health (NYSE:EHC) Shares Break Above 200-Day Moving Average - Here's Why

Key Points

• Encompass Health shares broke above their 200-day moving average, reaching $122.66 and closing near $121.14. Wall Street’s consensus rating is “Buy,” with an average price target of $148.50.
• The company reported quarterly earnings of $1.55 per share, beating estimates by $0.07, while revenue rose 9.6% year over year to $1.60 billion.
• Encompass Health raised its quarterly dividend to $0.21 per share, equivalent to an annualized $0.84 dividend and a 0.7% yield; meanwhile, insiders sold roughly $23.4 million of shares during the last quarter.

Encompass Health Corporation (NYSE:EHC - Get Free Report)'s share price crossed above its 200-day moving average during trading on Monday. The stock has a 200-day moving average of $109.95 and traded as high as $122.66. Encompass Health shares last traded at $121.14, with a volume of 1,061,636 shares changing hands.

Wall Street Analyst Weigh In

Several analysts have commented on the stock. Wall Street Zen upgraded shares of Encompass Health from a "hold" rating to a "buy" rating in a research note on Saturday, September 26th. Barclays lifted their target price on Encompass Health from $140.00 to $144.00 and gave the stock an "overweight" rating in a report on Thursday, August 6th. UBS Group raised their price target on Encompass Health from $150.00 to $155.00 and gave the company a "buy" rating in a report on Friday, August 7th. TD Cowen upped their price objective on Encompass Health from $125.00 to $140.00 and gave the stock a "buy" rating in a report on Monday, August 10th. Finally, Raymond James Financial set a $150.00 price target on shares of Encompass Health in a research report on Monday, September 28th. One research analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating and one has issued a Hold rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of "Buy" and an average price target of $148.50.

Encompass Health Stock Performance

The company has a debt-to-equity ratio of 0.76, a current ratio of 1.19 and a quick ratio of 1.19. The business has a 50-day moving average of $120.75 and a 200-day moving average of $109.95. The company has a market capitalization of $11.95 billion, a P/E ratio of 19.73, a P/E/G ratio of 2.43 and a beta of 0.74.

Encompass Health (NYSE:EHC - Get Free Report) last announced its earnings results on Wednesday, August 5th. The company reported $1.55 earnings per share for the quarter, beating the consensus estimate of $1.48 by $0.07. The business had revenue of $1.60 billion for the quarter, compared to the consensus estimate of $1.57 billion. Encompass Health had a net margin of 10.01% and a return on equity of 18.08%. The business's revenue for the quarter was up 9.6% on a year-over-year basis. During the same quarter in the prior year, the firm posted $1.40 earnings per share. Encompass Health has set its FY 2026 guidance at 6.020-6.250 EPS. On average, sell-side analysts anticipate that Encompass Health Corporation will post 6.08 EPS for the current year.

Encompass Health Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Thursday, October 15th. Investors of record on Thursday, October 1st will be paid a dividend of $0.21 per share. The ex-dividend date of this dividend is Thursday, October 1st. This represents a $0.84 dividend on an annualized basis and a dividend yield of 0.7%. This is an increase from Encompass Health's previous quarterly dividend of $0.19. Encompass Health's dividend payout ratio is 13.68%.

Insiders Place Their Bets

In other Encompass Health news, EVP John Darby sold 4,858 shares of the business's stock in a transaction dated Monday, August 31st. The shares were sold at an average price of $121.09, for a total value of $588,255.22. Following the completion of the sale, the executive vice president directly owned 75,041 shares of the company's stock, valued at $9,086,714.69. The trade was a 6.08% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, CEO Mark J. Tarr sold 173,148 shares of Encompass Health stock in a transaction that occurred on Monday, August 10th. The shares were sold at an average price of $125.47, for a total transaction of $21,724,879.56. Following the sale, the chief executive officer directly owned 267,814 shares of the company's stock, valued at $33,602,622.58. This represents a 39.27% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last quarter, insiders sold 186,912 shares of company stock worth $23,434,845. Insiders own 1.80% of the company's stock.

Institutional Investors Weigh In On Encompass Health

Institutional investors and hedge funds have recently bought and sold shares of the company. Transamerica Financial Advisors LLC bought a new stake in shares of Encompass Health in the second quarter valued at about $29,000. Persistent Asset Partners Ltd bought a new stake in shares of Encompass Health in the 2nd quarter valued at about $36,000. Keating Financial Advisory Services Inc. purchased a new stake in shares of Encompass Health in the 2nd quarter worth approximately $39,000. Assetmark Inc. increased its holdings in Encompass Health by 89.6% during the first quarter. Assetmark Inc. now owns 455 shares of the company's stock valued at $44,000 after buying an additional 215 shares during the period. Finally, Harbor Investment Advisory LLC purchased a new position in shares of Encompass Health in the 2nd quarter valued at $56,000. 97.25% of the stock is owned by institutional investors.

Encompass Health Company Profile

Encompass Health Corporation NYSE: EHC is a healthcare services company focused on inpatient rehabilitation. Through its network of rehabilitation hospitals, the company provides intensive medical and therapeutic care to patients recovering from conditions such as strokes, brain and spinal cord injuries, hip fractures, amputations, neurological disorders, and other disabling illnesses or injuries.

Its rehabilitation hospitals offer coordinated care from physicians, nurses, therapists, and other healthcare professionals.

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