NYSE$EHC

Encompass Health Corp · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Reported results for the fourth quarter of 2020 and issued full-year 2021 guidance and longer term growth targets.

Encompass Health reported positive results for Q4 2020, demonstrating the resilience of its business model. The company successfully met the needs of patients, employees, and business partners throughout the year, and remains confident in its business and long-term prospects for 2021.

  • Net operating revenues increased by 2.5% compared to Q4 2019.
  • Income from continuing operations attributable to Encompass Health per diluted share increased by 26.5% compared to Q4 2019.
  • Adjusted earnings per share increased by 9.4% compared to Q4 2019.
  • Cash flows provided by operating activities increased by 29.7% compared to Q4 2019.

Headline financials

Total Revenue

$1.21B

Previous: $1.18B+2.5%
EPS (adj)

$0.93

Previous: $0.85+9.4%
Discharges

46.5K

Previous: 47.9K-2.9%
Net patient revenue per discharge

$19.7K

Previous: $18.2K+7.9%
Capital Expenditures

$140M

Previous: $113M+24.3%
Free Cash Flow

$140M

Previous: $137M+2.2%
Net Income

$86M

Previous: $90.2M-4.7%
Operating Income

$150M

Previous: $118M+27.4%
Gross Profit

$1.16B

Previous: $1.14B+1.9%
Cash & Equivalents

$224M

Previous: $94.8M+136.3%
Total Assets

$6.45B

Previous: $6.08B+6.0%
Stock-Based Comp

$4.2M

Previous: $27.4M-84.7%

Revenue & EPS history

Encompass Health · Revenue · Quarterly

$1.21B

Q4 2020+2.5%vs Q4 2019
Beat estimate in 11 of 16 quarters(69%)
ActualEstimate

Forward guidance

The Company provided the following guidance for full-year 2021 and growth targets for 2020 through 2025. The Company's 2021 guidance and longer term growth targets assume the continuation of the current structure of the business. The guidance and growth targets may change depending on the ultimate outcome of the review.

Tailwinds

  • Net operating revenues $5,000 to $5,170 million
  • Adjusted EBITDA $925 to $955 million
  • Adjusted earnings per share from continuing operations attributable to Encompass Health $3.31 to $3.53
  • Net operating revenues 8% to 10% CAGR
  • Adjusted EBITDA 8% to 10% CAGR

Headwinds

  • Adjusted free cash flow 5% to 7% CAGR
  • Base year 2020 adjusted free cash flow benefited from a temporary payroll tax holiday.
  • Exclusive of this item, the adjusted free cash flow CAGR target would be 8% to 10%.
  • The review is ongoing, and no decision has been made.
  • The guidance and growth targets may change depending on the ultimate outcome of the review.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2020

Historical avgQ4 2020

+1.2%

Avg return

Earnings day

+1.6%

Avg return

5 days after

+2.5%

Avg return

30 days after

64%

42 / 66 earnings

Positive

+11.8%

Q1 2025

Best reaction

-9.0%

Q1 2015

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.1%+5.0%+6.0%
Q4 2025+5.9%+13.9%+7.4%
Q3 2025-6.9%-6.8%-7.5%
Q1 2025+11.8%+15.4%+17.2%
Q4 2024+1.3%-0.6%+0.7%
Q3 2024+7.0%+5.8%+10.0%
Q2 2024-8.7%-7.5%+1.0%
Q1 2024+0.3%+1.4%+2.5%
Q4 2023+1.7%+1.9%+5.9%
Q3 2023-1.9%+0.9%+6.7%
Q2 2023+5.0%+6.4%+7.6%
Q1 2023+0.7%-0.6%-5.9%
Q4 2022+1.6%+3.1%-9.1%
Q3 2022+6.4%+11.1%+16.6%
Q2 2022+0.6%+4.5%-4.0%
Q1 2022+2.6%+2.5%-2.0%
Q4 2021+1.5%-2.9%+8.8%
Q3 2021-6.0%-5.8%-9.8%
Q2 2021+0.7%+3.5%-4.1%
Q1 2021-1.6%-2.7%-2.5%
Q4 2020-3.9%-6.2%-6.1%
Q3 2020-2.6%-3.0%+25.9%
Q2 2020+4.5%+3.1%-6.4%
Q1 2020-1.1%-7.1%+6.4%
Q4 2019+0.4%+3.1%-2.6%
Q3 2019-5.8%+2.0%+5.5%
Q2 2019-4.0%-7.4%-12.6%
Q1 2019+5.3%+3.6%-4.6%
Q4 2018-4.4%-3.5%-13.3%
Q3 2018-5.7%-4.0%+1.4%
Q2 2018+8.8%+5.9%+17.4%
Q1 2018+7.2%+7.3%+10.3%
Q4 2017+3.0%+3.9%+7.7%
Q3 2017+1.8%+2.0%+8.7%
Q2 2017+1.9%-0.2%+3.6%
Q1 2017+7.9%+10.0%+6.3%
Q4 2016+0.1%+0.5%-1.9%
Q3 2016+1.8%+0.7%+5.6%
Q2 2016+6.7%+3.1%-0.3%
Q1 2016+10.9%
Q4 2015+9.2%
Q3 2015-0.3%
Q2 2015-2.9%
Q1 2015-9.0%
Q4 2014-4.7%
Q3 2014-3.0%
Q2 2014+7.4%
Q1 2014-0.4%
Q4 2013-2.8%
Q3 2013+0.6%
Q2 2013+4.7%
Q1 2013+3.1%
Q4 2012+7.2%
Q3 2012+2.5%
Q2 2012-3.7%
Q1 2012+9.2%
Q4 2010+3.9%
Q4 2011+3.9%
Q3 2011-1.0%
Q2 2011-9.0%
Q1 2010+0.4%
Q1 2011+2.5%
Q4 2008+7.8%
Q3 2010+2.2%
Q2 2010-1.0%
Q4 2009-1.0%

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