Latest Ratios: P/E Ratio 19.3x · EV/EBITDA 9.6x · ROE 18.5%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $10.6B | $10.8B | $9.4B | $6.8B | $6.0B | $5.2B | $6.6B | $5.5B | $4.9B | $3.9B | $3.3B |
| Enterprise Value | $13.2B | $13.5B | $12.1B | $9.6B | $9.0B | $8.6B | $9.9B | $8.7B | $7.3B | $6.4B | $6.2B |
| P/E Ratio → | 19.31 | 19.16 | 20.71 | 19.23 | 22.15 | 12.63 | 23.07 | 15.26 | 16.74 | 14.61 | 12.66 |
| P/S Ratio | 1.79 | 1.83 | 1.76 | 1.41 | 1.38 | 1.30 | 1.84 | 1.19 | 1.14 | 1.00 | 0.90 |
| P/B Ratio | 3.34 | 3.31 | 3.31 | 2.94 | 3.23 | 2.17 | 3.28 | 2.83 | 2.62 | 2.37 | 3.06 |
| P/FCF | 24.22 | 24.70 | 26.20 | 25.25 | 49.34 | 31.59 | 22.13 | 23.68 | 9.95 | 9.47 | 8.10 |
| P/OCF | 9.05 | 9.23 | 9.41 | 7.94 | 8.51 | 7.26 | 9.31 | 8.62 | 6.42 | 5.94 | 5.39 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 2.27 | 2.25 | 2.00 | 2.06 | 2.15 | 2.77 | 1.90 | 1.72 | 1.64 | 1.71 |
| EV / EBITDA | 9.59 | 9.75 | 10.37 | 4.80 | 10.27 | 9.82 | 13.36 | 9.58 | 8.33 | 7.71 | 7.59 |
| EV / EBIT | 12.58 | 12.51 | 13.60 | 13.10 | 14.33 | 12.90 | 18.41 | 12.09 | 11.46 | 9.87 | 9.54 |
| EV / FCF | — | 30.64 | 33.49 | 35.81 | 73.75 | 52.44 | 33.33 | 37.75 | 14.92 | 15.59 | 15.50 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 95.7% | 95.7% | 41.6% | 41.3% | 40.3% | 42.4% | 95.2% | 96.4% | 96.3% | 96.2% | 96.2% |
| Operating Margin | 17.7% | 17.7% | 16.1% | 35.9% | 14.5% | 16.4% | — | 15.0% | 15.9% | 16.6% | 17.8% |
| Net Profit Margin | 9.5% | 9.5% | 8.5% | 7.3% | 6.2% | 10.3% | 8.0% | 7.8% | 6.8% | 6.9% | 6.8% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 18.5% | 18.5% | 17.7% | 16.9% | 12.7% | 18.7% | 14.4% | 18.9% | 16.6% | 20.0% | 25.2% |
| ROA | 8.3% | 8.3% | 7.2% | 6.0% | 4.3% | 6.2% | 4.5% | 6.3% | 5.8% | 5.7% | 5.3% |
| ROIC | 13.9% | 13.9% | 12.2% | 26.0% | 8.9% | 8.9% | — | 10.9% | 12.0% | 11.9% | 12.1% |
| ROCE | 17.6% | 17.6% | 15.5% | 32.8% | 11.3% | 11.1% | — | 14.0% | 15.3% | 15.1% | 15.5% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.83 | 0.83 | 0.95 | 1.28 | 1.61 | 1.45 | 1.77 | 1.73 | 1.34 | 1.57 | 2.83 |
| Debt / EBITDA | 1.97 | 1.97 | 2.33 | 1.47 | 3.42 | 3.96 | 4.79 | 3.67 | 2.85 | 3.09 | 3.67 |
| Net Debt / Equity | — | 0.80 | 0.92 | 1.23 | 1.60 | 1.43 | 1.66 | 1.68 | 1.31 | 1.53 | 2.79 |
| Net Debt / EBITDA | 1.89 | 1.89 | 2.26 | 1.42 | 3.40 | 3.90 | 4.49 | 3.57 | 2.77 | 3.03 | 3.62 |
| Debt / FCF | — | 5.94 | 7.30 | 10.57 | 24.41 | 20.85 | 11.19 | 14.07 | 4.97 | 6.12 | 7.39 |
| Interest Coverage | 8.74 | 8.74 | 6.46 | 5.10 | 3.57 | 4.07 | 2.92 | 4.52 | 4.35 | 4.22 | 3.80 |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.08 | 1.08 | 1.05 | 1.28 | 1.25 | 1.23 | 1.32 | 1.05 | 0.98 | 1.36 | 1.38 |
| Quick Ratio | 1.08 | 1.08 | 1.05 | 1.28 | 1.25 | 1.23 | 1.32 | 1.05 | 0.90 | 1.24 | 1.25 |
| Cash Ratio | 0.17 | 0.17 | 0.10 | 0.22 | 0.04 | 0.07 | 0.31 | 0.13 | 0.10 | 0.11 | 0.09 |
| Asset Turnover | — | 0.84 | 0.82 | 0.79 | 0.77 | 0.58 | 0.55 | 0.76 | 0.82 | 0.80 | 0.78 |
| Inventory Turnover | — | — | — | — | — | — | — | — | 2.69 | 2.39 | 2.30 |
| Days Sales Outstanding | — | 38.08 | 40.68 | 46.50 | 45.06 | 45.65 | 57.62 | 39.53 | 39.91 | 44.03 | 44.47 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 0.7% | 0.7% | 0.7% | 0.9% | 1.6% | 2.2% | 1.7% | 2.0% | 2.1% | 2.3% | 2.6% |
| Payout Ratio | 12.6% | 12.6% | 13.8% | 17.2% | 36.5% | 27.2% | 39.4% | 30.3% | 34.5% | 33.8% | 33.8% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 5.2% | 5.2% | 4.8% | 5.2% | 4.5% | 7.9% | 4.3% | 6.6% | 6.0% | 6.8% | 7.9% |
| FCF Yield | 4.1% | 4.0% | 3.8% | 4.0% | 2.0% | 3.2% | 4.5% | 4.2% | 10.0% | 10.6% | 12.3% |
| Buyback Yield | 1.5% | 1.5% | 0.3% | 0.1% | 0.1% | 0.3% | 0.1% | 0.8% | 1.3% | 1.0% | 2.0% |
| Total Shareholder Yield | 2.1% | 2.1% | 1.0% | 1.0% | 1.8% | 2.4% | 1.8% | 2.8% | 3.4% | 3.3% | 4.6% |
| Shares Outstanding | — | $102M | $102M | $101M | $100M | $100M | $100M | $99M | $100M | $99M | $100M |
Regulatory reimbursement rate sensitivity
According to current market data, Encompass Health trades at a forward P/E of 16.86, which appears to command a premium over general hospital operators, suggesting that investors are pricing in the durability of its specialized inpatient rehabilitation model and the protection afforded by state-level Certificate of Need laws.
The current valuation multiple reflects a market expectation of sustained volume growth and margin stability in a pure-play IRF environment. While the PEG ratio of 1.29 suggests a reasonable price relative to projected growth, investors should monitor whether the company can maintain this premium if CMS introduces a unified post-acute payment model that threatens current reimbursement advantages.
Based on reported figures, Encompass Health's ROIC has remained in a tight range between 3.0% and 3.7% over the last several quarters, indicating that while the company is effectively deploying capital into new facilities, the high asset intensity of the business model limits the speed of compounding returns.
The modest ROIC trend suggests that the capital-intensive nature of building and equipping new rehabilitation hospitals acts as a drag on overall efficiency. Future improvements in return on capital will likely depend on the company's ability to increase occupancy rates at newer facilities and achieve greater economies of scale across its regional networks.
As reported in financial statements, Encompass Health has maintained a consistent DSO of approximately 37 to 40 days, which suggests that the company's revenue cycle management is effectively navigating the complexities of Medicare and private insurance billing despite the inherent friction in post-acute care reimbursement processes.
The stability in DSO indicates that the company's referral and billing protocols are well-integrated with acute-care partners, minimizing the risk of prolonged payment delays. Investors should continue to monitor these metrics for any signs of deterioration that might indicate increased scrutiny from Medicare Administrative Contractors or shifts in payer mix.
According to recent SEC filings, Encompass Health has aggressively reduced its debt-to-equity ratio from 1.28 in 2023Q4 to 0.08 in 2026Q1, a transformation that significantly strengthens the company's financial position and reduces its sensitivity to interest rate volatility compared to its historical capital structure.
This rapid deleveraging provides the company with substantial financial flexibility to fund ongoing de novo hospital construction without relying heavily on external financing. The improved interest coverage ratio further suggests that the company is well-positioned to weather potential operational headwinds or regulatory shocks that might impact cash flow generation.
Based on an analysis of financial reporting, the gross margin metric is frequently misapplied to Encompass Health because it fails to account for the classification of clinical labor as an operating expense, which obscures the true cost of service delivery and leads to an overestimation of operational profitability.
Analysts should prioritize operating margins and EBITDA-based metrics over gross margins to gain a clearer understanding of the company's underlying earning power. Relying on gross margin in this context may lead to flawed comparisons with other healthcare sectors that categorize labor differently, potentially misrepresenting the company's competitive cost structure.
Includes 30+ ratios · 30 years · Updated daily
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Quick answers to the most common questions about buying EHC stock.
Encompass Health Corporation's current P/E ratio is 19.3x. The historical average is 19.1x. This places it at the 65th percentile of its historical range.
Encompass Health Corporation's current EV/EBITDA is 9.6x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 11.8x.
Encompass Health Corporation's return on equity (ROE) is 18.5%. The historical average is 23.7%.
Based on historical data, Encompass Health Corporation is trading at a P/E of 19.3x. This is at the 65th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Encompass Health Corporation's current dividend yield is 0.65% with a payout ratio of 12.6%.
Encompass Health Corporation has 95.7% gross margin and 17.7% operating margin. Operating margin between 10-20% is typical for established companies.
Encompass Health Corporation's Debt/EBITDA ratio is 2.0x, indicating moderate leverage. A ratio below 2x is generally considered financially healthy.