Wall Street Zen Upgrades Encompass Health (NYSE:EHC) to Buy

Encompass Health (NYSE:EHC) was upgraded by Wall Street Zen from a “hold” rating to a “buy” rating in a research report issued on Sunday.

Several other equities research analysts have also recently commented on the stock. TD Cowen raised their target price on shares of Encompass Health from $125.00 to $140.00 and gave the stock a “buy” rating in a research report on Monday, August 10th. Weiss Ratings upgraded shares of Encompass Health from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Wednesday, August 12th. Barclays increased their price target on shares of Encompass Health from $140.00 to $144.00 and gave the stock an “overweight” rating in a research note on Thursday, August 6th. UBS Group raised their price objective on shares of Encompass Health from $150.00 to $155.00 and gave the stock a “buy” rating in a report on Friday, August 7th. Finally, Truist Financial lifted their price objective on Encompass Health from $140.00 to $150.00 and gave the company a “buy” rating in a research report on Friday, August 7th. One investment analyst has rated the stock with a Strong Buy rating, seven have given a Buy rating and one has issued a Hold rating to the company. According to data from MarketBeat, the company has a consensus rating of “Buy” and an average target price of $148.71.

Encompass Health Price Performance

EHC opened at $121.94 on Friday. The company has a debt-to-equity ratio of 0.76, a quick ratio of 1.19 and a current ratio of 1.19. Encompass Health has a 52-week low of $92.77 and a 52-week high of $127.99. The stock has a market capitalization of $12.03 billion, a PE ratio of 19.86, a price-to-earnings-growth ratio of 2.51 and a beta of 0.72. The stock’s 50 day moving average price is $109.53 and its 200-day moving average price is $105.72.

Encompass Health (NYSE:EHC) last announced its quarterly earnings results on Wednesday, August 5th. The company reported $1.55 EPS for the quarter, topping analysts’ consensus estimates of $1.48 by $0.07. The company had revenue of $1.60 billion during the quarter, compared to analyst estimates of $1.57 billion. Encompass Health had a return on equity of 18.08% and a net margin of 10.01%.The firm’s revenue was up 9.6% on a year-over-year basis. During the same quarter last 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, equities research analysts predict that Encompass Health will post 6.08 EPS for the current year.

Insider Activity

In related news, CEO Mark J. Tarr sold 173,148 shares of the business’s stock in a transaction dated 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 owned 267,814 shares of the company’s stock, valued at $33,602,622.58. The trade was a 39.27% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, EVP John Patrick Darby sold 8,906 shares of the company’s stock in a transaction dated Monday, August 10th. The stock was sold at an average price of $125.95, for a total transaction of $1,121,710.70. Following the completion of the sale, the executive vice president owned 75,041 shares in the company, valued at approximately $9,451,413.95. This trade represents a 10.61% decrease in their position. The SEC filing for this sale provides additional information. 1.80% of the stock is owned by company insiders.

Hedge Funds Weigh In On Encompass Health

Large investors have recently made changes to their positions in the business. Royal Bank of Canada grew its stake in shares of Encompass Health by 21.5% in the 1st quarter. Royal Bank of Canada now owns 88,470 shares of the company’s stock worth $8,960,000 after buying an additional 15,677 shares during the last quarter. Millennium Management LLC increased its position in Encompass Health by 38.4% during the 1st quarter. Millennium Management LLC now owns 92,197 shares of the company’s stock valued at $9,338,000 after buying an additional 25,574 shares in the last quarter. Caxton Associates LLP purchased a new position in Encompass Health during the first quarter valued at $259,000. Walleye Capital LLC boosted its holdings in Encompass Health by 667.6% in the second quarter. Walleye Capital LLC now owns 6,522 shares of the company’s stock worth $800,000 after acquiring an additional 7,671 shares in the last quarter. Finally, Gamco Investors INC. ET AL purchased a new stake in shares of Encompass Health in the second quarter worth $588,000. 97.25% of the stock is currently owned by hedge funds and other institutional investors.

About Encompass Health

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.