# Encompass Health Corporation Common Stock (EHC) — Stock CV

Encompass Health Corporation is a $12.2B healthcare company. Revenue grew 9.5% over the last year, it keeps 10¢ of every dollar of sales as profit, and its net debt equals ~5.9 years of free cash flow. It trades at 19.6× earnings — around the middle of its own history.

> Encompass Health Corp provides post-acute healthcare services in the United States through a network of inpatient rehabilitation hospitals, which is the company's sole segment.

## Identity

- **Ticker**: EHC
- **Sector**: Healthcare
- **Industry**: Services-Hospitals
- **Headquarters**: BIRMINGHAM, AL
- **Employees**: 29 944
- **Website**: https://www.encompasshealth.com
- **Market cap**: $12.2B
- **Last price**: $123.33
- **Financial profile**: Strained

## Vitals (TTM)

- **Revenue**: $6.21B
- **Net income**: $621M
- **Free cash flow**: $413M
- **Net debt**: $2.42B
- **P/E**: 19.6
- **Revenue growth (YoY)**: 9.5%

## Skills (profile scores, 0–100)

| Pillar | Score |
|---|---|
| Valuation | 77 |
| Growth | 43 |
| Profitability | 77 |
| Health | 35 |
| Quality | 90 |
| Moat | 43 |

## Qualifications (beginner checklist) — 9 of 11 passed

- [x] Revenue growing — +9.5% YoY
- [x] Profitable — $621M TTM
- [x] Profit growing — +27.1% YoY
- [x] Generates cash — $413M TTM
- [ ] Debt under control — ~5.9y of cash flow to repay
- [x] Established company — $12.2B market cap
- [x] Not printing shares — +2.4% shares over ~5y
- [x] Proven track record — 10/10 profitable years
- [ ] Financially stable — health score 30/100
- [x] Pays a dividend — yield 0.62%
- [x] Valuation not extreme — P/E 19.6

## Experience (career milestones)

- **FY2025** — Best year on record: $566M net income
- **2022** — The company operated a home health and hospice business that was spun off as Enhabit in 2022
- **FY2016** — Profitable every year on record: 10 consecutive profitable years in our data
- **FY2016** — Revenue already above $1B: $3.71B in first reported year
- **FY2016** — Positive free cash flow every year since: 10-year streak
- **1997** — The company's largest acquisition during the 1990s came in February 1997 when HealthSouth announced it would acquire…
- **1996** — It was later determined that $2.7 billion in fraud had occurred from 1996 to 2003
- **1995** — Including the $1.2 billion acquisition of Surgical Care…
- **1994** — HealthSouth expanded rapidly through acquisitions during the mid-to-late 1990s and changed its name again, dropping…
- **1993** — The company made its first large acquisition in late 1993 when it acquired 28 inpatient rehabilitation hospitals and…
- **1989** — The company moved its listing to the New York Stock Exchange in 1989 and purchased the 219-bed South Highlands…
- **1985** — The company changed its name to HealthSouth Rehabilitation Corporation in 1985 to distinguish itself from other…
- **Feb 22, 1984** — Encompass Health was incorporated as Amcare, Inc. on February 22, 1984 in Birmingham, Alabama by Richard M
- **1983** — Scrushy developed the idea for the company in 1983 while working at Lifemark Corporation, a publicly traded hospital…

## Strengths

- High gross margin (95.8%)
- Interest covered 9.0× by operating earnings
- Piotroski F-Score 9/9 — fundamentally strong checklist

## Watch-outs

- Net debt equals ~5.9 years of free cash flow

## Track record

| Year | Revenue | Net income | Free cash flow |
|---|---|---|---|
| FY2021 | $5.12B | $412M | $187M |
| FY2022 | $4.35B | $271M | $141M |
| FY2023 | $4.80B | $352M | $268M |
| FY2024 | $5.37B | $456M | $360M |
| FY2025 | $5.94B | $566M | $439M |

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Source: https://stockcv.com/EHC — derived from company filings; may be delayed or incomplete. Information, not investment advice.