Latest Ratios: P/E Ratio 21.3x · EV/EBITDA 10.7x · 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 | $13.6B | $10.8B | $9.4B | $6.8B | $6.0B | $5.2B | $6.6B | $5.5B | $4.9B | $3.9B | $3.3B |
| Enterprise Value | $16.3B | $13.5B | $12.1B | $9.6B | $9.0B | $8.6B | $9.9B | $8.7B | $7.3B | $6.4B | $6.2B |
| P/E Ratio → | 21.28 | 19.16 | 20.71 | 19.23 | 22.15 | 12.63 | 23.07 | 15.26 | 16.74 | 14.61 | 12.66 |
| P/S Ratio | 2.15 | 1.83 | 1.76 | 1.41 | 1.38 | 1.30 | 1.84 | 1.19 | 1.14 | 1.00 | 0.90 |
| P/B Ratio | 4.29 | 3.31 | 3.31 | 2.94 | 3.23 | 2.17 | 3.28 | 2.83 | 2.62 | 2.37 | 3.06 |
| P/FCF | 29.84 | 24.70 | 26.20 | 25.25 | 49.34 | 31.59 | 22.13 | 23.68 | 9.95 | 9.47 | 8.10 |
| P/OCF | 11.61 | 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 | 10.69 | 9.75 | 10.37 | 9.53 | 10.27 | 9.82 | 13.36 | 9.58 | 8.33 | 7.71 | 7.59 |
| EV / EBIT | 15.44 | 12.51 | 13.60 | 12.77 | 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 | 43.2% | 43.2% | 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% | 15.2% | 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% | 11.0% | 8.9% | 8.9% | — | 10.9% | 12.0% | 11.9% | 12.1% |
| ROCE | 17.6% | 17.6% | 15.5% | 13.9% | 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 | 2.92 | 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 | 2.81 | 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 | 5.23 | 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 | 0.5% | 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 | 4.7% | 5.2% | 4.8% | 5.2% | 4.5% | 7.9% | 4.3% | 6.6% | 6.0% | 6.8% | 7.9% |
| FCF Yield | 3.4% | 4.0% | 3.8% | 4.0% | 2.0% | 3.2% | 4.5% | 4.2% | 10.0% | 10.6% | 12.3% |
| Buyback Yield | 1.2% | 1.5% | 0.3% | 0.1% | 0.1% | 0.3% | 0.1% | 0.8% | 1.3% | 1.0% | 2.0% |
| Total Shareholder Yield | 1.7% | 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 |
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 21.3x. The historical average is 19.1x. This places it at the 78th percentile of its historical range.
Encompass Health Corporation's current EV/EBITDA is 10.7x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 11.9x.
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 21.3x. This is at the 78th 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 0.51% with a payout ratio of 12.6%.
Encompass Health Corporation has 43.2% 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.
Key Metrics
Top Statement Risk
Government payer reimbursement concentration
Metrics are mathematically derived from official filings.
Premium Multiples Demand Sustained Growth
Based on EHC's reported figures, the trailing P/E of 21.28 and EV/EBITDA of 10.69 sit at a premium to the broader hospital group, implying the market is pricing in continued double-digit revenue growth that depends on Medicare reimbursement stability.
The forward P/E of 21.90 sits slightly above the trailing figure, which suggests consensus does not expect meaningful earnings acceleration over the next twelve months. A PEG of 1.50 indicates the market is paying a moderate premium for the growth profile, though that premium narrows only if top-line expansion holds near 10 percent. The P/FCF of 29.84 is considerably higher than the P/E, which appears to reflect capex-driven free cash flow volatility rather than a valuation anomaly.
Operating Margin Reflects True Earning Power
As reported in quarterly income statements, EHC's operating margin of 17.7 percent and net margin of 9.3 percent are more reliable earning-power indicators than the gross margin, which swings between 21.6 and 44.5 percent due to labor cost classification.
The gross margin series appears distorted by how clinical labor is classified, so it should not be used as a standalone profitability signal. Operating margin has held in a 16.5 to 19.0 percent band across most periods, suggesting underlying cost control has been reasonably consistent. Net margin volatility, from 8.0 to 12.3 percent, may partly reflect non-operating items and tax timing, which warrants further investigation in the filings.
Returns Thin Despite Equity Rebuilding
According to recent SEC filings, EHC's ROIC of roughly 3.5 percent and ROE of 4.3 to 5.9 percent sit well below typical levels for a capital-intensive operator, suggesting that rising equity has diluted returns more than improved margins have lifted them.
ROIC has remained in a narrow 3.0 to 3.8 percent band across ten quarters, which indicates the expanding hospital asset base is not yet compounding returns. Because ROE is calculated on a rapidly growing equity base, the ratio may understate operating economics if retained earnings are being deployed into long-cycle de novo projects. Investors should monitor whether ROIC moves toward the cost of capital as newer facilities mature.
Leverage Easing as Equity Outpaces Debt
Based on EHC's reported figures, the debt-to-equity ratio declined from 1.16 to 0.79 while interest coverage held near 9.0 times, suggesting debt service has become more comfortable even as the absolute debt load remained broadly flat.
The improvement in leverage reflects equity growth rather than debt reduction, which is a meaningful distinction for assessing refinancing exposure. Debt-to-EBITDA of roughly 7.2 to 7.5 times remains elevated in absolute terms, so coverage comfort depends heavily on sustained EBITDA. The reported debt-to-equity figure in the supplied intelligence appears inconsistent with the ratio series and warrants verification against filings.
Thin Cushion Relies on Operating Cash
As reported in financial statements, EHC's current and quick ratios of roughly 1.05 to 1.35 indicate liquidity that is adequate on paper but dependent on continuous operating cash flow rather than a substantial cash reserve.
Cash balances in the reported range appear small relative to current obligations, so the company likely relies on steady collections to meet near-term liabilities. Current and quick ratios are identical in the data because inventory is negligible for a hospital operator, meaning the quick ratio adds no incremental information. Under a severe reimbursement shock, the thin cash position would leave limited room to absorb a timing mismatch in payments.
Reimbursement Concentration Caps Multiple Expansion
As reported in company disclosures, roughly three-quarters of revenue is tied to government payers, so a CMS rate reset could compress the 17.7 percent operating margin and challenge the premium 21.28 trailing P/E.
The most commonly misapplied metric for this business is the gross margin, since clinical labor classification inflates it relative to peers and obscures true cost intensity. Operating margin and SWB as a share of revenue better reflect earning power for a facility-based rehabilitation operator. A reimbursement-driven margin reset would matter more to valuation than any single-quarter ratio movement, which warrants monitoring of CMS and Medicare Advantage payment updates.