Why This 1 Growth Stock Could Be a Great Addition to Your Portfolio

Zacks
01-07

Taking full advantage of the stock market and investing with confidence are common goals for new and old investors alike.

Achieving those goals is made easier with the Zacks Style Scores, a unique set of guidelines that rates stocks based on popular investing methodologies, namely value, growth, and momentum. The Style Scores can help you narrow down which stocks are better for your portfolio and which ones can beat the market over the long-term.

Why This 1 Growth Stock Should Be On Your Watchlist

For growth investors, a company's financial strength, overall health, and future outlook take precedence, so they'll want to zero in on the Growth Style Score. This Score examines things like projected and historical earnings, sales, and cash flow to find stocks that will generate sustainable growth over time.

Encompass Health (EHC)

Encompass Health Corporation is a provider of integrated healthcare services. It offers facility-based patient care through its network of inpatient rehabilitation hospitals. With a national footprint that includes 162 hospitals across 37 states and Puerto Rico, the company delivers high-quality, cost-effective, integrated care in the healthcare space. It provides a continuum of facility-based for its patients and their families, which will gain more prevalence as coordinated care and integrated delivery payment models, such as accountable care organizations and bundled payment arrangements.

EHC boasts a Growth Style Score of A and VGM Score of A, and holds a Zacks Rank #3 (Hold) rating. Its bottom-line is projected to rise 17.9% year-over-year for 2024, while Wall Street anticipates its top line to improve by 11.3%.

One analyst revised their earnings estimate higher in the last 60 days for fiscal 2024, while the Zacks Consensus Estimate has increased $0.01 to $4.29 per share. EHC also boasts an average earnings surprise of 13.6%.

Encompass Health is also cash rich. The company has generated cash flow growth of 2.9%, and is expected to report cash flow expansion of 21% in 2024.

EHC should be on investors' short lists because of its impressive growth fundamentals, a good Zacks Rank, and strong Growth and VGM Style Scores.

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