Encompass Health (NYSE:EHC) Shares Gap Up – Still a Buy?

Encompass Health Corporation (NYSE:EHC)’s stock price gapped up prior to trading on Monday . The stock had previously closed at $97.39, but opened at $102.08. Encompass Health shares last traded at $103.5710, with a volume of 234,230 shares traded.

Analysts Set New Price Targets

A number of research analysts have commented on EHC shares. Barclays increased their price target on shares of Encompass Health from $150.00 to $153.00 and gave the company an “overweight” rating in a research report on Friday, February 6th. Wall Street Zen raised shares of Encompass Health from a “hold” rating to a “buy” rating in a report on Sunday, January 18th. Two analysts have rated the stock with a Strong Buy rating, seven have given a Buy rating and one has issued a Hold rating to the company’s stock. According to data from MarketBeat.com, Encompass Health currently has an average rating of “Buy” and an average target price of $143.29.

Encompass Health Stock Up 5.9%

The company has a current ratio of 1.08, a quick ratio of 1.08 and a debt-to-equity ratio of 0.76. The stock has a 50 day simple moving average of $102.36 and a 200 day simple moving average of $110.13. The firm has a market capitalization of $10.26 billion, a PE ratio of 18.65, a PEG ratio of 1.87 and a beta of 0.75.

Encompass Health (NYSE:EHC) last released its quarterly earnings data on Thursday, February 5th. The company reported $1.46 earnings per share for the quarter, beating analysts’ consensus estimates of $1.29 by $0.17. Encompass Health had a return on equity of 18.20% and a net margin of 9.54%.The firm had revenue of $3.09 billion during the quarter, compared to analyst estimates of $1.54 billion. During the same quarter in the prior year, the firm posted $1.17 earnings per share. The business’s quarterly revenue was up 9.9% compared to the same quarter last year. Encompass Health has set its FY 2026 guidance at 5.810-6.100 EPS. As a group, sell-side analysts forecast that Encompass Health Corporation will post 4.8 earnings per share for the current year.

Encompass Health Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, April 15th. Shareholders of record on Wednesday, April 1st will be given a $0.19 dividend. The ex-dividend date is Wednesday, April 1st. This represents a $0.76 dividend on an annualized basis and a dividend yield of 0.7%. Encompass Health’s payout ratio is presently 13.72%.

Insider Activity

In related news, CEO Mark J. Tarr sold 150,000 shares of the business’s stock in a transaction dated Wednesday, February 11th. The stock was sold at an average price of $111.64, for a total transaction of $16,746,000.00. Following the transaction, the chief executive officer owned 377,070 shares in the company, valued at $42,096,094.80. The trade was a 28.46% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, Treasurer Edmund Fay sold 11,937 shares of the stock in a transaction that occurred on 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 completion of the sale, the treasurer owned 89,325 shares of the company’s stock, valued at approximately $9,557,775. This trade represents a 11.79% decrease in their position. The SEC filing for this sale provides additional information. Corporate insiders own 2.00% of the company’s stock.

Institutional Trading of Encompass Health

Institutional investors and hedge funds have recently added to or reduced their stakes in the business. Citizens National Bank Trust Department purchased a new stake in shares of Encompass Health in the 3rd quarter worth about $26,000. First Horizon Corp purchased a new stake in Encompass Health in the third quarter worth about $34,000. WPG Advisers LLC lifted its holdings in Encompass Health by 73.3% in the fourth quarter. WPG Advisers LLC now owns 324 shares of the company’s stock worth $34,000 after buying an additional 137 shares during the period. Westside Investment Management Inc. boosted its position in Encompass Health by 56.7% during the 3rd quarter. Westside Investment Management Inc. now owns 279 shares of the company’s stock valued at $35,000 after acquiring an additional 101 shares in the last quarter. Finally, Flagship Harbor Advisors LLC purchased a new position in shares of Encompass Health during the 4th quarter worth approximately $37,000. Hedge funds and other institutional investors own 97.25% of the company’s stock.

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.