Encompass Health Tops Q3 Estimates and Lifts 2026 Guidance on Revenue, EBITDA and EPS
EHC sits 32% above its 52-week low of $92.77.
Summary
Encompass Health reported Q3 revenue of $1.61B (+8.9%) and adjusted EPS of $1.52, then raised full-year 2026 guidance for revenue, Adjusted EBITDA and EPS. Adjusted free cash flow rose 51% to $263.4M.
Key Events · Earnings and Guidance · EHC
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Q3 Revenue Up 8.9% to $1.61B
Net operating revenue came in at $1,609.5M versus $1,477.5M a year ago, as discharges rose 5.7% to 69,605 and net patient revenue per discharge increased 4.0% to $22,543.
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2026 Guidance Raised Again
Full-year revenue guidance moves to $6,450-$6,500M from $6,410-$6,490M, Adjusted EBITDA to $1,395-$1,415M from $1,365-$1,395M, and adjusted EPS to $6.23-$6.37 from $6.02-$6.25.
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Adjusted EBITDA +15.5%, FCF +51%
Q3 Adjusted EBITDA was $346.6M versus $300.1M, while adjusted free cash flow reached $263.4M versus $174.2M; nine-month adjusted FCF totaled $634.2M.
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Bad Debt Reserves Jump to 2.7%
Reserves rose 80 bps from 1.9% of revenue, a move tied to a billing and collecting disruption after a Q2 2026 system conversion; Q4 guidance assumes 2.0-2.5%.
Analysis · EHC · Industrial Applications And Services
Management raised the full-year outlook for the second time this year, with revenue now guided to $6.45-$6.50B, Adjusted EBITDA to $1.395-$1.415B and adjusted EPS to $6.23-$6.37. The raise follows Q3 revenue of $1.61B, up 8.9%, and Adjusted EBITDA of $346.6M, up 15.5%. Adjusted free cash flow of $263.4M, up 51%, gives the company room to fund its de novo pipeline and the enlarged $1B buyback. The one soft spot: bad debt reserves at 2.7% of revenue versus 1.9% a year ago, which management attributes to a Q2 system-conversion billing disruption and expects to normalize to 2.0-2.5% in Q4.
How filings like this one have moved
In the 30 days to Oct 29, 2026, 31.1% of the 1661 measured filings Wiseek scored 7 moved their stock by 5% or more by the next session's close. The median move was 0.00%. These are measured outcomes after filings of this importance, not a forecast for this one.
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At the time of this filing, EHC was trading at $122.09 on NYSE in the Industrial Applications And Services sector, with a market capitalization of approximately $12B. The 52-week trading range was $92.77 to $129.96. This filing was assessed with positive market sentiment and an importance score of 7 out of 10.