Zacks Research Issues Pessimistic Estimate for EHC Earnings

Key Points

• Zacks Research lowered near-term EPS estimates for Encompass Health, cutting Q2 2026 to $1.46 from $1.49 and also trimming several later-quarter forecasts, signaling a more cautious outlook for the next few quarters.
• Longer-term earnings estimates were nudged higher, with FY2027 EPS raised to $6.35 and FY2028 to $7.16, suggesting analysts still see continued growth beyond the near term.
• The company recently beat Wall Street’s quarterly expectations, reporting $1.60 EPS on $1.59 billion in revenue versus forecasts of $1.51 EPS and $1.57 billion, while maintaining FY2026 guidance of $5.89 to $6.11 EPS.

Encompass Health Corporation (NYSE:EHC - Free Report) - Equities research analysts at Zacks Research reduced their Q2 2026 earnings per share (EPS) estimates for shares of Encompass Health in a report issued on Thursday, May 14th. Zacks Research analyst Team now anticipates that the company will post earnings of $1.46 per share for the quarter, down from their previous estimate of $1.49. The consensus estimate for Encompass Health's current full-year earnings is $5.96 per share. Zacks Research also issued estimates for Encompass Health's Q3 2026 earnings at $1.36 EPS, Q4 2026 earnings at $1.55 EPS, FY2026 earnings at $5.96 EPS, Q1 2027 earnings at $1.63 EPS, Q2 2027 earnings at $1.60 EPS, Q3 2027 earnings at $1.48 EPS, Q4 2027 earnings at $1.64 EPS, FY2027 earnings at $6.35 EPS, Q1 2028 earnings at $1.80 EPS and FY2028 earnings at $7.16 EPS.

Other analysts have also recently issued reports about the company. Barclays lowered their price target on Encompass Health from $153.00 to $140.00 and set an "overweight" rating on the stock in a research report on Tuesday, May 5th. Wall Street Zen upgraded Encompass Health from a "hold" rating to a "buy" rating in a research report on Saturday, May 2nd. Two equities research analysts have rated the stock with a Strong Buy rating, six have assigned a Buy rating and one has assigned a Hold rating to the company. Based on data from MarketBeat.com, the company presently has an average rating of "Buy" and an average target price of $144.17.

Encompass Health Stock Performance

Shares of NYSE:EHC opened at $106.64 on Monday. The business's fifty day moving average price is $102.94 and its two-hundred day moving average price is $106.26. Encompass Health has a fifty-two week low of $92.77 and a fifty-two week high of $127.99. The stock has a market capitalization of $10.58 billion, a price-to-earnings ratio of 17.80, a price-to-earnings-growth ratio of 2.33 and a beta of 0.72. The company has a debt-to-equity ratio of 0.76, a current ratio of 1.17 and a quick ratio of 1.17.

Encompass Health (NYSE:EHC - Get Free Report) last issued its quarterly earnings results on Thursday, April 30th. The company reported $1.60 EPS for the quarter, topping analysts' consensus estimates of $1.51 by $0.09. The company had revenue of $1.59 billion during the quarter, compared to analyst estimates of $1.57 billion. Encompass Health had a return on equity of 18.28% and a net margin of 10.04%.The company's quarterly revenue was up 9.0% compared to the same quarter last year. During the same period in the previous year, the company earned $1.37 earnings per share. Encompass Health has set its FY 2026 guidance at 5.890-6.110 EPS.

Institutional Investors Weigh In On Encompass Health

Institutional investors have recently bought and sold shares of the company. First Horizon Corp acquired a new position in shares of Encompass Health during the 3rd quarter worth approximately $34,000. Westside Investment Management Inc. increased its position in shares of Encompass Health by 56.7% during the 3rd quarter. Westside Investment Management Inc. now owns 279 shares of the company's stock worth $35,000 after purchasing an additional 101 shares during the last quarter. Assetmark Inc. increased its position in shares of Encompass Health by 88.1% during the 3rd quarter. Assetmark Inc. now owns 299 shares of the company's stock worth $38,000 after purchasing an additional 140 shares during the last quarter. Root Financial Partners LLC bought a new position in shares of Encompass Health during the 3rd quarter worth approximately $39,000. Finally, WPG Advisers LLC boosted its stake in shares of Encompass Health by 73.3% during the 4th quarter. WPG Advisers LLC now owns 324 shares of the company's stock worth $34,000 after acquiring an additional 137 shares during the period. Institutional investors own 97.25% of the company's stock.

Insiders Place Their Bets

In other Encompass Health news, Treasurer Edmund Fay sold 11,937 shares of the stock in a transaction dated Monday, March 9th. The stock was sold at an average price of $107.00, for a total value of $1,277,259.00. Following the transaction, the treasurer owned 89,325 shares of the company's stock, valued at approximately $9,557,775. This represents a 11.79% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, EVP Patrick William Tuer sold 682 shares of the stock in a transaction dated Monday, May 11th. The shares were sold at an average price of $104.56, for a total value of $71,309.92. Following the completion of the transaction, the executive vice president directly owned 24,755 shares in the company, valued at $2,588,382.80. The trade was a 2.68% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. 1.80% of the stock is owned by insiders.

Encompass Health Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Wednesday, July 15th. Investors of record on Wednesday, July 1st will be paid a dividend of $0.19 per share. The ex-dividend date of this dividend is Wednesday, July 1st. This represents a $0.76 dividend on an annualized basis and a dividend yield of 0.7%. Encompass Health's payout ratio is 12.69%.

Encompass Health News Summary

Here are the key news stories impacting Encompass Health this week:

• Positive Sentiment: Zacks Research raised its FY2027 EPS estimate for Encompass Health to $6.35 from $6.32, and also nudged FY2028 EPS higher to $7.16 from $7.13, signaling expectations for continued longer-term earnings growth.
• Positive Sentiment: The firm also increased its Q1 2027 EPS estimate to $1.63 from $1.57 and Q1 2028 EPS to $1.80 from $1.73, which may support confidence in future operating performance.
• Neutral Sentiment: Zacks Research left several other estimates unchanged, including FY2026 EPS at $5.96 and the company’s broader earnings profile, while the consensus full-year estimate remains $5.97 per share.
• Negative Sentiment: The analyst firm lowered near-term estimates for Q2 2026 to $1.46 from $1.49, Q3 2026 to $1.36 from $1.40, and Q4 2026 to $1.55 from $1.62, suggesting some caution around the next few quarters.
• Negative Sentiment: Additional cuts were made to Q2 2027 EPS to $1.60 from $1.62 and Q4 2027 EPS to $1.64 from $1.65, reinforcing a mildly softer near-term earnings view.

Encompass Health Company Profile

Encompass Health Corporation is a leading provider of post‐acute healthcare services in the United States, operating a comprehensive network of inpatient rehabilitation hospitals and home health and hospice agencies. Its inpatient rehabilitation hospitals offer intensive therapy programs for patients recovering from conditions such as stroke, brain injury, spinal cord injury, cardiac and pulmonary disorders, and orthopedic procedures. Through its home health segment, Encompass Health delivers skilled nursing, physical therapy, occupational therapy and speech therapy to patients in the comfort of their homes, while its hospice services provide end‐of‐life care focused on symptom management and emotional support for patients and families.

Founded in 1984 as HealthSouth Corporation and rebranded as Encompass Health in 2018, the company has grown organically and through acquisitions to serve patients across more than 30 states.

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