Why Encompass Health (EHC) is a Top Growth Stock for the Long-Term

Zacks
18 Nov 2024

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals.

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

Growth investors build their portfolios around companies that are financially strong and have a bright future, and the Growth Style Score helps take projected and historical earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.

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 B and VGM Score of A, and holds a Zacks Rank #2 (Buy) rating. Its bottom-line is projected to rise 17.6% year-over-year for 2024, while Wall Street anticipates its top line to improve by 11.2%.

Nine analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.10 to $4.28 per share for 2024. EHC boasts an average earnings surprise of 13.6%.

On a historic basis, Encompass Health has generated cash flow growth of 2.9%, and is expected to report cash flow expansion of 21% this year.

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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