Published on 23 Apr 2024 on Zacks via Yahoo Finance

Should You Buy Encompass Health (EHC) Ahead of Q1 Earnings?

Encompass Health Corporation EHC is scheduled to release first-quarter 2024 results on Apr 24, 2024, after market close. An aging U.S. population, growing patient volumes and capacity expansion measures have been working well for the company, partially undone by rising costs.

Factors at Play

Revenues of Encompass Health have been benefiting on the back of improved patient volumes and higher discharge growth. Volumes receive an impetus from the company’s extensive geographical presence and favorable patient mix. We expect discharges to advance 7.2% year over year in the first quarter of 2024.Revenue growth coupled with tactical cost-curbing initiatives drive adjusted EBITDA growth, which is estimated to witness 10.7% year-over-year growth in the to-be-reported quarter, per our model estimate.An aging U.S. population, along with the need for effective rehabilitative services that empower individuals to resume daily activities, is likely to have sustained the solid demand for EHC’s services offered through its inpatient rehabilitation hospitals in the days ahead. We expect inpatient revenues at $1.2 billion in the first quarter, up 8.9% year over year.