Encompass Health Corporation (EHC) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-80.4%

$26.90

vs $137.29 price

Levered DCF

$89.65

After debt service

Piotroski score

5 / 9

Average

Altman Z-score

3.41

Safe zone

Rating

B+

Overall 3 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	18.89×	20.39×	18.85×	21.99×	12.5×	22.91×	15.09×	16.41×
P/B	4.37×	4.46×	4.03×	4.53×	2.69×	4.08×	3.99×	3.61×
P/S	1.8×	1.72×	1.38×	1.36×	1.28×	1.82×	1.17×	1.12×
EV / EBITDA	9.46×	9.99×	9.24×	10.23×	9.64×	13.25×	9.2×	8.63×
Gross margin	43.2%	41.6%	41.3%	40.3%	42.4%	95.2%	96.4%	96.3%
Operating margin	17.7%	16.1%	15.2%	14.5%	16.4%	0.0%	15.0%	15.9%
Net margin	9.5%	8.5%	7.3%	6.2%	10.3%	8.0%	7.8%	6.8%
Current ratio	1.08×	1.05×	1.28×	1.25×	1.23×	1.32×	1.05×	0.98×
Debt / equity	1.11×	1.31×	1.78×	2.28×	1.82×	2.23×	2.48×	1.89×
Interest coverage	8.55×	6.29×	5.1×	3.59×	4.01×	0×	4.34×	4.63×
Dividend yield	0.7%	0.7%	0.9%	1.7%	2.2%	1.7%	2.0%	2.1%
Payout ratio	12.6%	13.8%	17.2%	36.5%	27.2%	39.4%	30.3%	34.5%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	23.2%	22.0%	21.4%	20.7%	21.6%	17.9%	26.5%	22.0%
Return on invested capital	13.3%	11.8%	10.4%	9.6%	8.5%	0.0%	10.1%	11.3%
Return on assets	8.0%	7.0%	5.8%	4.8%	6.0%	4.4%	5.9%	5.6%
Free cash flow yield	4.1%	3.9%	4.0%	2.1%	3.2%	4.6%	4.3%	10.2%
Earnings yield	5.3%	4.9%	5.3%	4.6%	8.0%	4.4%	6.6%	6.1%
Enterprise value	$13.3B	$11.9B	$9.5B	$8.9B	$8.6B	$9.8B	$8.6B	$7.2B
Net debt / EBITDA	1.86×	2.22×	2.76×	3.41×	3.86×	4.49×	3.46×	2.91×
Cash conversion cycle (days)	19	21	24	26	24	-188	-166	-31