Encompass Health: BofA Conference takes: Robust demand, strong cash flows

研报英文原文证据摘录

Encompass Health: BofA Conference takes: Robust demand, strong cash flows

Accessible version

Encompass Health

BofA Conference takes: Robust demand,

strong cash flows

Reiterate Rating: BUY | PO: 150.00 USD | Price: 108.80 USD

Positive tone on volumes, cash flows - reiterate Buy 12 May 2026

We hosted meetings with Encompass Health (EHC), including Doug Coltharp, CFO, and Equity

Zabi Hotaki, SVP, Finance, at our Health Care Conference. Overall, the tone was bullish as

Joanna Gajuk

the company sees a continued strong demand (discharges +6-8% long-term CAGR) Research Analyst

underscored by the 95%+ occupancy at 35% of locations. In addition, the strong cash BofAS +1 646 855 3961

flow generation allows EHC to fund growth as well as return capital to shareholders via joanna.gajuk@bofa.com

dividends and share repo. Reiterate Buy. Kevin Fischbeck, CFA

Research Analyst

Volumes on track, accelerate rest of year BofAS+1 646 855 5948

Q1 discharge growth of 4.3% was below the 6-8% LT CAGR due to 1) 85bps headwind kevin.fischbeck@bofa.com

from closure of 4 units (3 rehab units, one SNF) with no impact to EBITDA; 2) capacity Craig Jones Research Analyst

constraints at 35% of EHC’s hospitals that have occupancy over 95%, and 3) flu season BofAS

milder y/y. Discharges should grow 5-6% for the rest of the year as the unit closure +1craig.jones3@bofa.com646 743 2020

headwind is lapped and EHC captures patients from closed units in its other locations in Joaquin Arriagada Martinez

the markets. The unit closure headwind should step down by 25bps each quarter. Research Analyst

BofAS

Bed adds next 15 months focused on high-occupancy mkts +1joaquin.arriagadamartinez@bofa.com646 855 1654

Given the high occupancy in 35% of IRFs, capacity expansion plans are concentrated on Katie FitzGerald