Encompass Health Corporation
of the Company General We are the nation s largest owner and operator of inpatient rehabilitation hospitals in terms of patients treated, revenues, and number of hospitals. We provide specialized rehabilitative treatment, using advanced technology and intensive therapy, on an inpatient basis for patients recovering from a major injury or illness and seeking to regain functional ability…
$120.47
-$1.20 (-0.99%)
EOD Oct 21, 2026
17.74% operating margin is respectable but not wide. ROIC at 16.31%. Suggests the business covers its cost of capital, but doesn't point to a wide moat.
Revenue grew 10.5%, still solid.
Net debt of $2.94B represents 6.7x FCF, leverage limits flexibility.
19.6x earnings, 28.7x FCF. Valuation is in a reasonable range. The main question is whether the business can re-accelerate or if current trajectory is already priced in.
Price History
Valuation & Multiples
Based on TTM earnings · Diluted shares
Profitability & Returns
Revenue (TTM)
$6.21B
▲ +10.5% YoY
Net Income (TTM)
$621M
▲ +24.2% YoY
Op. Margin
18.00%
▲ +1.7pp YoY
ROIC
16.41%
▲ +2.1pp YoY
Cash Flow & Balance Sheet
FCF (TTM)
$413M
▲ +21.9% YoY
Op. Cash Flow (TTM)
$1.21B
▲ +17.2% YoY
Net Debt
$3.02B
Cash & Equiv.
$108M
5Y CAGR: +10.7%
5Y CAGR: +7.1%
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SourceComputed from the 10-Q filed 28 Jul 2026, covering the period ending 30 Jun 2026, as reported to the SEC. Data last refreshed 12 Oct 2026. How this is calculated.
Price from market data, last close as of 21 Oct 2026. Fiscal year ends Dec. Sector medians are approximate S&P 500 benchmarks and update periodically.
Is Encompass Health (EHC) overvalued?
At a P/E of 19.6 and a price-to-free-cash-flow of 28.7, Encompass Health (EHC) trades around a two-stage DCF intrinsic value of about $142.16 per share, so at $120.47 the stock looks around fair value (18.0% below estimated intrinsic value). A high multiple is not the same as overvalued: fast-growing, high-quality businesses can deserve a premium. See the general approach in how to tell if a stock is overvalued.
On quality, Encompass Health scores 75/100 on Intrinsiqq's quality scorecard (a solid business on these measures), weighing growth, margins, returns on capital, share count, and balance-sheet strength. It currently yields about 0.6%; see dividend safety for coverage and history. All figures are computed from SEC filings; read the full methodology, or see how the market compares in our US profitability statistics. This is analysis, not investment advice.
Frequently asked
What is Encompass Health's fair value?+
Intrinsiqq's two-stage DCF estimates an intrinsic value of about $142.16 per share for EHC, projecting its recent free cash flow forward with a growth rate that fades toward a long-run rate and discounting it back to today. Applying a 25% margin of safety gives a more conservative fair-value entry around $106.62. At today's $120.47, that puts the stock about 18.0% below estimated intrinsic value. The result is sensitive to the growth and discount-rate inputs, so it is best to run conservative, base and optimistic cases. You can adjust all of them yourself with the sliders on the DCF tab.
Is Encompass Health a high-quality business?+
Encompass Health scores 75 out of 100 on Intrinsiqq's quality score, a weighted blend of 8 metrics each scored 0 to 100, which makes it a solid business on these measures. Recent fundamentals include a 18.0% operating margin and a 16.4% return on invested capital. The score weighs revenue and free-cash-flow growth, operating margins, return on invested capital, share-count change, and balance-sheet strength, all computed from SEC filings, not opinion. Because valuation only means something relative to quality, the full metric-by-metric breakdown is on the quality scorecard.
Does Encompass Health (EHC) pay a dividend, and how much?+
Yes, Encompass Health pays a regular dividend of about $0.75 per share per year (typically in quarterly installments), a yield of roughly 0.6% at the current price. That is a payout ratio of about 12.1% of earnings, so the dividend is amply covered by earnings. A low headline yield is not the same as a weak dividend: what matters is how well earnings and free cash flow cover the payout and whether it is growing, not the percentage alone. For EHC's full payout history, growth streak and dividend-safety score, see the dividends tab.
Is Encompass Health a good stock to buy right now?+
That depends on valuation and quality together, not either alone. EHC currently trades around its estimated intrinsic value and scores 75/100 on quality (solid). It also yields about 0.6%. A cheap price is only a bargain if the business is durable, and a premium can be justified by genuine quality, so the two questions, "is it cheap?" and "is it good?", only make sense side by side. Read the valuation against the quality scorecard, run the DCF on your own assumptions, and decide for yourself. This is analysis from SEC filings, not investment advice.
Related stocks: Services-Hospitals
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Data sourced from SEC EDGAR filings and third-party price providers. Scores, valuations, and metrics are algorithmic estimates. This is not investment advice. See our Terms and Methodology.
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