Revenue growth remains steady at 9.0% year-over-year as of 2026Q1, with disciplined cost management maintaining operating margins at 14.6% despite the high fixed-cost nature of the business.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 | Dec'97 | Dec'96 |
|---|
| Sales/Revenue | 6.07B | 5.94B | 5.37B | 4.8B | 4.35B | 4.01B | 3.57B | 4.61B | 4.28B | 3.91B | 3.64B | 3.12B | 2.37B | 2.25B | 2.13B | 2.01B | 1.86B | 1.91B | 1.83B | 1.74B | 1.71B | 1.75B | 3.75B | 3.96B | 3.52B | 3.25B | 3.45B | 4.07B | 4.01B | 3.12B | 2.65B |
| Revenue Growth % | 10.05% | 10.46% | 11.91% | 10.41% | 8.31% | 12.58% | -22.56% | 7.66% | 9.28% | 7.45% | 16.91% | 31.23% | 5.66% | 5.26% | 6.43% | 7.77% | -2.61% | 4.46% | 5.29% | 1.51% | -2.24% | -53.36% | -5.15% | 12.44% | 8.37% | -5.89% | -15.25% | 1.65% | 28.27% | 17.94% | 24.99% |
| Cost of Goods Sold | 2.5B | 254.4M | 3.14B | 2.82B | 2.6B | 2.31B | 171M | 167.9M | 158.7M | 149.3M | 140M | 128.7M | 111.9M | 105.4M | 102.4M | 102.8M | 99.4M | 0 | 48.8M | 100.3M | 925.3M | 914.5M | 0 | 0 | 3.09B | 0 | 0 | 0 | 0 | 1.95B | 1.72B |
| COGS % of Revenue | - | 4.29% | 58.44% | 58.7% | 59.68% | 57.57% | 4.79% | 3.65% | 3.71% | 3.81% | 3.84% | 4.13% | 4.71% | 4.69% | 4.8% | 5.12% | 5.34% | - | 2.67% | 5.77% | 54.06% | 52.23% | - | - | 87.88% | - | - | - | - | 62.51% | 64.88% |
| Gross Profit | 3.57B | 5.68B | 2.23B | 1.98B | 1.75B | 1.7B | 3.4B | 4.44B | 4.12B | 3.76B | 3.5B | 2.99B | 2.26B | 2.14B | 2.03B | 1.9B | 1.76B | 1.91B | 1.78B | 1.64B | 786.3M | 836.4M | 0 | 0 | 1.22B | 0 | 0 | 0 | 0 | 1.17B | 930.1M |
| Gross Margin % | 58.82% | 95.71% | 41.56% | 41.3% | 40.32% | 42.43% | 95.21% | 96.35% | 96.29% | 96.19% | 96.16% | 95.87% | 95.29% | 95.31% | 95.2% | 94.88% | 94.66% | 100% | 97.33% | 94.23% | 45.94% | 47.77% | - | - | 34.6% | - | - | - | - | 37.49% | 35.12% |
| Gross Profit Growth % | - | 154.38% | 12.63% | 13.1% | 2.92% | -49.83% | -23.48% | 7.73% | 9.4% | 7.48% | 17.26% | 32.03% | 5.63% | 5.38% | 6.8% | 8.02% | -7.81% | 7.32% | 8.77% | 108.22% | -5.99% | - | - | -100% | - | - | - | - | -100% | 25.9% | 37.26% |
| Operating Expenses | 2.48B | 4.63B | 1.37B | 258M | 1.12B | 1.04B | 3.4B | 4.44B | 4.12B | 3.76B | 3.5B | 2.99B | 2.26B | 2.14B | 2.03B | 1.9B | 1.76B | 1.91B | 1.78B | 1.64B | 786.3M | 836.4M | 3.75B | 3.96B | 426.57M | 3.25B | 3.45B | 4.07B | 4.01B | 1.17B | 930.1M |
| OpEx % of Revenue | - | 77.97% | 25.47% | 5.37% | 25.82% | 26% | 95.21% | 96.35% | 96.29% | 96.19% | 96.16% | 95.87% | 95.29% | 95.31% | 95.2% | 94.88% | 94.66% | 100% | 97.33% | 94.23% | 45.94% | 47.77% | 100% | 100% | 12.12% | 100% | 100% | 100% | 100% | 37.49% | 35.12% |
| Selling, General & Admin | 1.07B | 3.41B | 266.5M | 258M | 209M | 228.5M | 2.12B | 2.9B | 2.65B | 2.4B | 2.19B | 1.86B | 1.34B | 1.27B | 1.23B | 1.16B | 1.09B | 1.26B | 1.12B | 1.37B | 631.5M | 642.7M | 0 | 0 | 304.44M | 167.21M | 148.02M | 149.28M | 112.8M | 162.3M | 144.3M |
| SG&A % of Revenue | - | 57.47% | 4.96% | 5.37% | 4.81% | 5.69% | 59.36% | 63.02% | 62.01% | 61.31% | 60.14% | 59.73% | 56.33% | 56.31% | 57.75% | 57.92% | 58.56% | 65.87% | 61.17% | 79.02% | 36.9% | 36.71% | - | - | 8.65% | 5.15% | 4.29% | 3.67% | 2.82% | 5.2% | 5.45% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 4M | 1.22B | 1.1B | 0 | 914M | 815.5M | 1.28B | 1.53B | 1.47B | 1.36B | 1.31B | 1.13B | 925M | 876.5M | 799.7M | 741.2M | 671.8M | 652.3M | 661.6M | 264.3M | 154.8M | 193.7M | 3.75B | 3.96B | 122.13M | 3.08B | 3.3B | 3.92B | 3.89B | 1.01B | 785.8M |
| Operating Income | 1.02B | 1.05B | 864.5M | 1.72B | 630.2M | 659.4M | 0 | 692.5M | 681.6M | 649.4M | 648.8M | 554.2M | 465.7M | 458.8M | 413.4M | 374.1M | 327.8M | 276.9M | 406.6M | 188.1M | 68M | 104.1M | 233.12M | -140.43M | 3.52B | 2.92B | 3.09B | 1.38B | 1.51B | 751.6M | 572.8M |
| Operating Margin % | 16.79% | 17.74% | 16.09% | 35.92% | 14.49% | 16.42% | - | 15.04% | 15.94% | 16.59% | 17.81% | 17.79% | 19.61% | 20.42% | 19.36% | 18.65% | 17.61% | 14.49% | 22.22% | 10.83% | 3.97% | 5.95% | 6.21% | -3.55% | 100% | 89.87% | 89.51% | 33.97% | 37.8% | 24.07% | 21.63% |
| Operating Income Growth % | - | 21.82% | -49.88% | 173.69% | -4.43% | - | -100% | 1.6% | 4.96% | 0.09% | 17.07% | 19% | 1.5% | 10.98% | 10.51% | 14.12% | 18.38% | -31.9% | 116.16% | 176.62% | -34.68% | -55.35% | 266.01% | -103.99% | 20.58% | -5.51% | 123.33% | -8.65% | 101.46% | 31.22% | 40.05% |
| EBITDA | 1.35B | 1.38B | 1.16B | 2B | 873.8M | 879M | 739.6M | 911.2M | 881.3M | 833.2M | 821.4M | 693.9M | 573.4M | 553.5M | 495.9M | 452.9M | 400.9M | 347.8M | 489M | 273.3M | 173.1M | 232.6M | 432.61M | 59.77M | 3.73B | 3.29B | 3.45B | 1.76B | 1.86B | 494.5M | 359.8M |
| EBITDA Margin % | 22.33% | 23.27% | 21.66% | 41.63% | 20.09% | 21.89% | 20.74% | 19.79% | 20.6% | 21.29% | 22.55% | 22.27% | 24.15% | 24.63% | 23.23% | 22.58% | 21.54% | 18.2% | 26.73% | 15.73% | 10.11% | 13.28% | 11.52% | 1.51% | 105.84% | 101.43% | 99.97% | 43.16% | 46.4% | 15.83% | 13.59% |
| EBITDA Growth % | 9.89% | 18.63% | -41.76% | 128.74% | -0.59% | 18.85% | -18.83% | 3.39% | 5.77% | 1.44% | 18.37% | 21.02% | 3.6% | 11.62% | 9.49% | 12.97% | 15.27% | -28.88% | 78.92% | 57.89% | -25.58% | -46.23% | 623.83% | -98.4% | 13.09% | -4.52% | 96.3% | -5.45% | 275.88% | 37.44% | 45.02% |
| D&A (Non-Cash Add-back) | 336M | 327.9M | 299.6M | 273.9M | 243.6M | 219.6M | 203M | 218.7M | 199.7M | 183.8M | 172.6M | 139.7M | 107.7M | 94.7M | 82.5M | 78.8M | 73.1M | 70.9M | 82.4M | 85.2M | 105.1M | 128.5M | 199.49M | 200.19M | 205.7M | 375.27M | 360.85M | 374.25M | 344.59M | -257.1M | -213M |
| EBIT | 805.8M | 1.08B | 887M | 731.8M | 626.5M | 669.3M | 536.6M | 722M | 640.5M | 650.8M | 654.1M | 538.5M | 496.1M | 495.6M | 434.1M | 362.3M | 315.5M | 249.3M | 355M | 188.1M | 68M | 104.1M | 233.12M | -140.43M | 3.52B | 2.92B | 3.09B | 1.38B | 1.51B | 751.6M | 572.8M |
| Net Interest Income | -91.4M | -123.2M | -137.4M | -143.5M | -175.7M | -164.3M | -183.7M | -159.7M | -147.3M | -154.4M | -172.1M | -142.9M | -109.2M | -100.4M | -94.1M | -119.4M | -125.6M | -125.8M | -159.5M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 123.2M | 123.2M | 137.4M | 143.5M | 175.7M | 164.3M | 183.7M | 159.7M | 147.3M | 154.4M | 172.1M | 142.9M | 109.2M | 100.4M | 94.1M | 119.4M | 125.6M | 125.8M | 159.5M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | -15.3M | -100.1M | -114.9M | -1.12B | -179.4M | -154.4M | 352.9M | -130.2M | -188.4M | -153M | -166.8M | -158.6M | -78.8M | -63.6M | -73.4M | -131.2M | -137.9M | -153.4M | -211.1M | -312.2M | -582.6M | -471.1M | -375.12M | -358.36M | -3.88B | -3.08B | -3.52B | -1.15B | -1.25B | -194.8M | -227.5M |
| Pretax Income | 1B | 953M | 749.6M | 607.2M | 450.8M | 505M | 352.9M | 562.3M | 493.2M | 496.4M | 482M | 395.6M | 386.9M | 395.2M | 340M | 242.9M | 189.9M | 123.5M | 195.5M | -124.1M | -514.6M | -367M | -141.99M | -498.79M | -363.9M | -164.56M | -434.5M | 229.91M | 267.37M | 556.8M | 345.3M |
| Pretax Margin % | 16.54% | 16.06% | 13.95% | 12.65% | 10.37% | 12.58% | 9.9% | 12.21% | 11.53% | 12.68% | 13.23% | 12.7% | 16.3% | 17.59% | 15.93% | 12.11% | 10.2% | 6.46% | 10.69% | -7.14% | -30.07% | -20.96% | -3.78% | -12.6% | -10.34% | -5.07% | -12.59% | 5.65% | 6.67% | 17.83% | 13.04% |
| Income Tax | 207.7M | 192.9M | 150.2M | 132.2M | 100.1M | 101.9M | 74.7M | 115.9M | 118.9M | 145.8M | 163.9M | 141.9M | 110.7M | 12.7M | 108.6M | 37.1M | -740.8M | -3.2M | -70.1M | -322.4M | 22.4M | 19.6M | 11.91M | -42.42M | -55.21M | 44.91M | -76.58M | 66.93M | 143.35M | 213.7M | 148.5M |
| Effective Tax Rate % | 20.71% | 20.24% | 20.04% | 21.77% | 22.2% | 20.18% | 21.17% | 20.61% | 24.11% | 29.37% | 34% | 35.87% | 28.61% | 3.21% | 31.94% | 15.27% | -390.1% | -2.59% | -35.86% | 259.79% | -4.35% | -5.34% | -8.39% | 8.5% | 15.17% | -27.29% | 17.63% | 29.11% | 53.61% | 38.38% | 43.01% |
| Net Income | 609.2M | 566.2M | 455.7M | 352M | 271M | 412.2M | 284.2M | 358.7M | 292.3M | 271.1M | 247.6M | 183.1M | 222M | 323.6M | 185M | 208.7M | 899M | 94.8M | 252.4M | 653.4M | -625M | -446M | -174.47M | -434.56M | -466.8M | -191.22M | -364.24M | 76.52M | 46.56M | 343.1M | 196.8M |
| Net Margin % | 10.04% | 9.54% | 8.48% | 7.33% | 6.23% | 10.27% | 7.97% | 7.79% | 6.83% | 6.93% | 6.8% | 5.88% | 9.35% | 14.4% | 8.67% | 10.4% | 48.3% | 4.96% | 13.8% | 37.61% | -36.52% | -25.47% | -4.65% | -10.98% | -13.26% | -5.89% | -10.55% | 1.88% | 1.16% | 10.99% | 7.43% |
| Net Income Growth % | 23.15% | 24.25% | 29.46% | 29.89% | -34.26% | 45.04% | -20.77% | 22.72% | 7.82% | 9.49% | 35.23% | -17.52% | -31.4% | 74.92% | -11.36% | -76.79% | 848.31% | -62.44% | -61.37% | 204.54% | -40.13% | -155.63% | 59.85% | 6.91% | -144.11% | 47.5% | -576.03% | 64.35% | -86.43% | 74.34% | 100.41% |
| Net Income (Continuing) | 757.6M | 760.1M | 599.4M | 475M | 350.7M | 403.1M | 278.2M | 446.4M | 374.3M | 350.6M | 318.1M | 253.7M | 276.2M | 382.5M | 231.4M | 205.8M | 930.7M | 126.7M | 265.6M | 198.3M | -537M | -386.6M | -153.91M | -456.37M | -557.3M | -179.19M | -428.57M | 162.99M | -30.91M | 343.1M | 196.8M |
| Discontinued Operations | -500K | -1M | -2.8M | -12M | 15.2M | 114.1M | 90.6M | -600K | 1.1M | -400K | 0 | -900K | 5.5M | -1.1M | 4.5M | 48.8M | 9.1M | 2.1M | 16.2M | 455.1M | -88M | -59.4M | -20.56M | 24.27M | 0 | -71.58M | -6.33M | 0 | 0 | 0 | 0 |
| Minority Interest | 58.8M | 837.6M | 782.2M | 649.7M | 551.6M | 487.9M | 413.6M | 580.5M | 542M | 463.8M | 331.1M | 289M | 231M | 137.6M | 112.5M | 84.6M | 83M | 76.4M | 82.2M | 97.2M | 271.1M | 273.74M | 243.98M | 226.38M | 0 | 154.54M | 137.98M | 126.38M | 127.22M | 93.69M | 69.26M |
| EPS (Diluted) | 6.06 | 5.54 | 4.46 | 3.47 | 2.70 | 4.11 | 2.85 | 3.61 | 2.93 | 2.69 | 2.59 | 1.91 | 2.29 | 2.58 | 1.67 | 1.91 | 8.28 | 0.77 | 2.62 | 7.10 | -6.92 | -5.60 | -2.19 | -5.35 | -3.31 | -2.45 | -4.70 | 0.90 | 0.55 | 5.22 | 3.23 |
| EPS Growth % | 20.45% | 24.22% | 28.53% | 28.52% | -34.31% | 44.21% | -21.05% | 23.21% | 8.92% | 3.86% | 35.6% | -16.59% | -11.24% | 54.49% | -12.57% | -76.93% | 975.32% | -70.61% | -63.1% | 202.6% | -23.57% | -155.71% | 59.07% | -61.63% | -35.1% | 47.87% | -622.22% | 63.64% | -89.46% | 61.61% | -6.38% |
| EPS (Basic) | - | 5.62 | 4.53 | 3.54 | 2.72 | 4.15 | 2.87 | 3.65 | 2.99 | 2.73 | 2.77 | 2.02 | 2.46 | 2.58 | 1.67 | 1.91 | 9.41 | 0.77 | 2.73 | 7.97 | -7.86 | -5.62 | -2.20 | -5.49 | -3.41 | -2.45 | -4.70 | 0.95 | 0.55 | 5.22 | 3.23 |
| Diluted Shares Outstanding | 100.6M | 102.2M | 102.2M | 101.3M | 100.4M | 100.2M | 99.8M | 99.4M | 99.8M | 99.3M | 99.5M | 101M | 100.7M | 102.1M | 108.1M | 109.2M | 108.5M | 103.3M | 96.4M | 92M | 90.3M | 79.6M | 79.53M | 81.17M | 81.7M | 83.03M | 78.28M | 82.91M | 86.45M | 79.66M | 65.77M |
| Basic Shares Outstanding | 99.2M | 100.5M | 99.9M | 99.5M | 99.2M | 99M | 98.6M | 98M | 97.9M | 93.7M | 89.1M | 89.4M | 86.8M | 88.1M | 94.6M | 93.3M | 92.8M | 88.8M | 83M | 78.7M | 79.5M | 79.3M | 79.28M | 79.23M | 79.1M | 78.1M | 77.33M | 81.64M | 84.29M | 79.66M | 65.77M |
| Dividend Payout Ratio | - | 12.56% | 13.78% | 17.16% | 36.53% | 27.22% | 39.37% | 30.3% | 34.49% | 33.75% | 33.84% | 42.16% | 29.64% | 4.85% | - | - | 3.83% | 34.49% | 13.23% | - | - | - | - | - | - | - | - | - | - | 23.29% | 22% |
Regulatory reimbursement rate sensitivity
According to recent quarterly filings, Encompass Health has maintained a steady revenue growth trajectory, reaching $1.6 billion in 2026Q1, which represents a 9.0% year-over-year increase, largely driven by sustained demand for inpatient rehabilitation services and successful expansion of the company's facility footprint across key regional markets.
The consistent top-line growth suggests that the company is successfully leveraging its specialized clinical focus to capture referral volume from acute-care partners. Investors should monitor whether this growth remains durable as the company scales its de novo hospital pipeline in a potentially higher-cost capital environment.
As reported in financial statements, Encompass Health's gross margins have stabilized near the 41-48% range, excluding anomalous reporting periods, which indicates a disciplined approach to managing the high fixed-cost base inherent in operating specialized inpatient rehabilitation facilities under strict Medicare-mandated staffing requirements.
The variability in reported gross margins appears to reflect internal accounting adjustments rather than fundamental shifts in pricing power. The company's ability to maintain operating margins in the mid-teens suggests that it possesses sufficient scale to absorb labor cost pressures that often plague smaller, less specialized healthcare providers.
Based on EHC's reported figures, operating income has demonstrated resilience, scaling to $232.3 million in 2026Q1, which implies that management is effectively controlling SG&A expenses relative to the growth in gross profit, thereby enhancing the company's overall operational efficiency as it matures as a pure-play IRF operator.
The trend of operating income growth suggests that the company is successfully achieving economies of scale within its regional clusters. However, analysts should remain cautious, as any significant increase in clinical labor costs could quickly erode these gains given the fixed-reimbursement nature of the business model.
Analysis of the income statement reveals that net income has grown to $194.5 million in 2026Q1, with EPS reaching $1.77, suggesting that the company's bottom-line performance is increasingly driven by core operational improvements rather than the non-operating items that characterized earlier periods of corporate restructuring.
The reduction in volatility of net income following the Enhabit spin-off indicates a cleaner earnings profile that is easier for the market to model. Investors should continue to scrutinize the impact of stock-based compensation, which remains a consistent, albeit manageable, drag on reported earnings per share.
While current performance appears robust, the potential implementation of a Unified Post-Acute Care payment model by CMS, as noted in industry risk disclosures, poses a significant threat to the premium reimbursement rates that currently underpin Encompass Health's specialized inpatient rehabilitation business model and overall profitability.
Short-term margin expansion may mask the long-term risk of regulatory convergence, which could force a re-rating of the company's valuation. If CMS moves to equalize payments across post-acute settings, the company's reliance on high-acuity, high-reimbursement patient segments may face structural headwinds that are not currently reflected in the income statement.
Quick answers to the most common questions about buying EHC stock.
For fiscal year 2025, Encompass Health Corporation (EHC) reported total revenue of $5.94B. This represents a 124.1% increase compared to $2.65B in 1996.
Encompass Health Corporation (EHC) is profitable, generating $566.2M in net income for the fiscal year ending 2025 with a net profit margin of 9.5%.
Encompass Health Corporation (EHC) reported an operating income of $1.05B, resulting in an operating profit margin of 17.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Encompass Health Corporation (EHC) generated $5.68B in gross profit for the year, representing a gross profit margin of 95.7%. This demonstrates the company's core pricing power and production efficiency.