Financial Performance - Q2 2025 - Net operating revenue increased by 12.0% to $1,457.7 million compared to $1,301.2 million in Q2 2024[8] - Adjusted EBITDA increased by 17.2% to $318.6 million compared to $271.8 million in Q2 2024[8] - Adjusted EPS increased by 26.1% to $1.40 compared to $1.11 in Q2 2024[8] - Adjusted free cash flow increased by 30.5% to $185.9 million compared to $142.5 million in Q2 2024[8] Financial Performance - YTD Q2 2025 - Net operating revenue increased by 11.3% to $2,913.1 million compared to $2,617.2 million in YTD Q2 2024[8] - Adjusted EBITDA increased by 16.0% to $632.2 million compared to $544.8 million in YTD Q2 2024[8] - Adjusted EPS increased by 24.2% to $2.77 compared to $2.23 in YTD Q2 2024[8] - Adjusted free cash flow increased by 31.7% to $408.3 million compared to $310.1 million in YTD Q2 2024[8] Revenue Details - Inpatient revenue increased by 11.7% to $1,413.7 million in Q2 2025 compared to $1,265.5 million in Q2 2024[13] - Outpatient and other revenue increased by 23.2% to $44.0 million in Q2 2025 compared to $35.7 million in Q2 2024, including an $8.5 million increase in Medicaid supplemental payments[13] - Discharges increased by 7.2% to 65,237 in Q2 2025 compared to 60,833 in Q2 2024[13] 2025 Guidance (Updated) - Net Operating Revenue guidance increased to $5,880 to $5,980 million from the previous guidance of $5,850 to $5,925 million[22] - Adjusted EBITDA guidance increased to $1,220 to $1,250 million from the previous guidance of $1,185 to $1,220 million[22] - Adjusted earnings per share guidance increased to $5.12 to $5.34 from the previous guidance of $4.85 to $5.10[22]

Core Insights - Encompass Health reported strong financial results for Q2 2025, with GAAP revenue of $1.46 billion, exceeding consensus by $30.47 million, and non-GAAP EPS of $1.40, surpassing analyst expectations [1][2] - The company experienced double-digit growth in both revenue and profits compared to Q2 2024, prompting management to raise full-year guidance across key metrics [1][2] Financial Performance - Q2 2025 GAAP revenue was $1.46 billion, a 12.0% increase from $1.30 billion in Q2 2024 [2] - Non-GAAP EPS reached $1.40, up 26.1% from $1.11 in Q2 2024 [2] - Adjusted EBITDA grew 17.2% to $319 million from $272 million in the previous year [2] - Adjusted free cash flow increased by 30.5% compared to Q2 2024 [9] Operational Highlights - Total discharges rose to 65,237, a 7.2% increase year-over-year, with same-store discharges growing by 4.7% [5] - Revenue per discharge was $21,670, reflecting a 4.2% year-over-year increase [5] - The payer mix improved, with higher-reimbursement government programs increasing their share by 1.5 percentage points [6] Strategic Focus - The company operates 169 hospitals across 38 states and Puerto Rico, focusing on inpatient rehabilitation services [3] - Recent strategies include expansion through new hospital openings and adding beds to existing facilities [4] - Management emphasizes quality patient outcomes, regulatory compliance, and strategic partnerships [4] Future Outlook - Full-year net operating revenue guidance is now projected between $5.88 billion and $5.98 billion, with adjusted EBITDA guidance increased to $1.22 billion–$1.25 billion [13] - Management plans to continue growth through new hospital openings and bed expansions, targeting 6 to 10 new hospitals and 80 to 120 beds added annually [14]

Core Insights - Encompass Health (EHC) reported $1.46 billion in revenue for Q2 2025, a 12% year-over-year increase, with an EPS of $1.40 compared to $1.11 a year ago, exceeding Zacks Consensus Estimates for both revenue and EPS [1] - The company achieved a revenue surprise of +2.29% and an EPS surprise of +16.67% compared to analyst expectations [1] Financial Performance Metrics - Net patient revenue per discharge was $21,670, surpassing the two-analyst average estimate of $21,429.50 [4] - Total discharges were 65,237, slightly above the average estimate of 64,850 [4] - Net Operating Revenues for Inpatient services reached $1.41 billion, exceeding the average estimate of $1.39 billion, reflecting an 11.7% year-over-year increase [4] - Net Operating Revenues for Outpatient and other services were $44 million, above the average estimate of $43.19 million, showing a year-over-year increase of 23.3% [4] Stock Performance - Encompass Health shares have returned -8.8% over the past month, contrasting with the Zacks S&P 500 composite's +0.6% change [3] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential outperformance against the broader market in the near term [3]

Core Insights - Encompass Health (EHC) reported quarterly earnings of $1.4 per share, exceeding the Zacks Consensus Estimate of $1.2 per share, and showing an increase from $1.11 per share a year ago, resulting in an earnings surprise of +16.67% [1] - The company achieved revenues of $1.46 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 2.29% and up from $1.3 billion year-over-year [2] - Encompass Health has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] Earnings Performance - The earnings surprise for the previous quarter was +15.13%, with actual earnings of $1.37 per share compared to an expected $1.19 per share [1] - The current consensus EPS estimate for the upcoming quarter is $1.16 on revenues of $1.47 billion, and for the current fiscal year, it is $5.01 on revenues of $5.89 billion [7] Stock Performance and Outlook - Encompass Health shares have increased approximately 17.5% since the beginning of the year, outperforming the S&P 500's gain of 6.1% [3] - The company's favorable estimate revisions trend prior to the earnings release has resulted in a Zacks Rank 2 (Buy), indicating expected outperformance in the near future [6] Industry Context - Encompass Health operates within the Medical - Outpatient and Home Healthcare industry, which is currently ranked in the top 26% of over 250 Zacks industries [8] - The industry’s strong performance is supported by empirical research showing that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1 [8]

[Executive Summary & Financial Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Financial%20Highlights) This section provides an overview of Encompass Health's strong Q2 2025 financial and operational performance, updated full-year guidance, and key operational developments [Q2 2025 Performance Overview](index=1&type=section&id=Q2%202025%20Performance%20Overview) Encompass Health reported strong financial and operational growth for Q2 2025, with significant increases in net operating revenue, earnings per share, and cash flows, driven by higher discharges and improved pricing Q2 2025 Key Financial and Operational Metrics | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Growth (Dollars) | Growth (%) | | :--------------------------------------- | :----------------- | :----------------- | :--------------- | :--------- | | Net operating revenue | $1,457.7 | $1,301.2 | $156.5 | 12.0% | | Income from continuing operations per diluted share | $1.40 | $1.13 | $0.27 | 23.9% | | Adjusted earnings per share | $1.40 | $1.11 | $0.29 | 26.1% | | Cash flows provided by operating activities | $270.2 | $217.4 | $52.8 | 24.3% | | Adjusted EBITDA | $318.6 | $271.8 | $46.8 | 17.2% | | Adjusted free cash flow | $185.9 | $142.5 | $43.4 | 30.5% | | Discharges | 65,237 | 60,833 | - | 7.2% | | Same-store discharge growth | - | - | - | 4.7% | | Net patient revenue per discharge | $21,670 | $20,803 | - | 4.2% | [Full-Year 2025 Guidance Update](index=2&type=section&id=2025%20Guidance) Encompass Health increased its full-year 2025 guidance across key financial metrics, including net operating revenue, Adjusted EBITDA, and Adjusted earnings per share, reflecting a positive outlook Full-Year 2025 Guidance Comparison | Metric | Previous Guidance (Millions) | Updated Guidance (Millions) | | :---------------------------------------------------- | :------------------------- | :------------------------ | | Net operating revenue | $5,850 to $5,925 | $5,880 to $5,980 | | Adjusted EBITDA | $1,185 to $1,220 | $1,220 to $1,250 | | Adjusted earnings per share from continuing operations | $4.85 to $5.10 | $5.12 to $5.34 | [Operational Developments](index=2&type=section&id=Operational%20Developments) The company expanded its capacity for inpatient rehabilitation care by opening a new hospital and adding beds to an existing facility during the quarter - Increased capacity to serve patients by opening a new **60-bed hospital** in Fort Myers, Florida, and adding **26 beds** to an existing hospital[4](index=4&type=chunk) [Company Information](index=2&type=section&id=Company%20Information) This section details Encompass Health's identity as the largest inpatient rehabilitation hospital operator, highlighting its operational scale and industry accolades [About Encompass Health](index=2&type=section&id=About%20Encompass%20Health) Encompass Health is the largest owner and operator of inpatient rehabilitation hospitals in the United States, providing high-quality, compassionate rehabilitative care and recognized for its industry leadership - Encompass Health (NYSE: EHC) is the **largest owner and operator of inpatient rehabilitation hospitals** in the United States[7](index=7&type=chunk) - Operates **169 hospitals** in **38 states and Puerto Rico**, focusing on high-quality, compassionate rehabilitative care using advanced technology[7](index=7&type=chunk) - Ranked as one of Fortune's **World's Most Admired Companies** and Forbes' **Most Trusted Companies in America**[7](index=7&type=chunk) [Consolidated Financial Statements](index=4&type=section&id=Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated financial statements, including statements of operations, balance sheets, and cash flows, reflecting strong growth [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The condensed consolidated statements of operations show substantial year-over-year growth in net operating revenues and net income for both the three and six months ended June 30, 2025 Condensed Consolidated Statements of Operations (Millions) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | 6M 2025 (Millions) | 6M 2024 (Millions) | | :---------------------------------------------------- | :----------------- | :----------------- | :----------------- | :----------------- | | Net operating revenues | $1,457.7 | $1,301.2 | $2,913.1 | $2,617.2 | | Total operating expenses | $1,198.6 | $1,085.6 | $2,387.0 | $2,194.1 | | Income from continuing operations before income tax expense | $236.8 | $186.0 | $475.4 | $364.4 | | Net income attributable to Encompass Health | $142.1 | $114.1 | $293.6 | $226.6 | | Diluted EPS from continuing operations attributable to Encompass Health | $1.40 | $1.13 | $2.88 | $2.24 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet reflects an increase in total assets as of June 30, 2025, compared to December 31, 2024, primarily driven by growth in property and equipment, goodwill, and cash Condensed Consolidated Balance Sheets (Millions) | Metric | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :-------------------------------- | :----------------------- | :--------------------------- | | Total assets | $6,785.7 | $6,534.7 | | Total current assets | $918.1 | $886.9 | | Property and equipment, net | $3,820.3 | $3,643.1 | | Goodwill | $1,303.0 | $1,284.0 | | Total liabilities | $3,697.5 | $3,685.5 | | Total shareholders' equity | $3,033.1 | $2,792.7 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash provided by operating activities increased significantly, while cash used in investing and financing activities also saw increases compared to the prior year Condensed Consolidated Statements of Cash Flows (Millions) | Metric | 6M 2025 (Millions) | 6M 2024 (Millions) | | :----------------------------------- | :----------------- | :----------------- | | Net cash provided by operating activities | $558.8 | $456.2 | | Net cash used in investing activities | $(323.9) | $(288.1) | | Net cash used in financing activities | $(220.6) | $(90.2) | | Increase in cash, cash equivalents, and restricted cash | $14.3 | $77.9 | | Cash, cash equivalents, and restricted cash at end of period | $137.4 | $182.1 | [Supplemental Information & Non-GAAP Reconciliations](index=3&type=section&id=Supplemental%20Information%20%26%20Non-GAAP%20Reconciliations) This section clarifies the use of non-GAAP financial measures and provides detailed reconciliations for Adjusted EBITDA, Adjusted EPS, and Adjusted Free Cash Flow [Note Regarding Non-GAAP Financial Measures](index=3&type=section&id=Other%20information) Encompass Health uses non-GAAP financial measures and provides reconciliations to GAAP, but does not offer GAAP guidance for certain non-GAAP metrics due to the unpredictability of specific items outside its control - The press release includes non-GAAP financial measures such as **adjusted earnings per share**, **leverage ratio**, **Adjusted EBITDA**, and **adjusted free cash flow**, with reconciliations to comparable GAAP measures[9](index=9&type=chunk) - GAAP guidance is not provided for certain non-GAAP measures (excluding net operating revenues) because the company cannot reasonably predict the future impact of items deemed outside its control or not indicative of ongoing operating performance[10](index=10&type=chunk) - Reasonably estimable GAAP measures for 2025, if other reconciling GAAP measures could be predicted, include approximately **$125 million for interest expense** and amortization of debt discounts and fees, and **$10 million for amortization of debt-related items**[11](index=11&type=chunk) [Adjusted EBITDA Reconciliations](index=9&type=section&id=Adjusted%20EBITDA%20Reconciliations) This section provides detailed reconciliations of both net cash provided by operating activities and net income to Adjusted EBITDA, adjusting for various non-operating and non-recurring items for both quarterly and year-to-date periods [Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA](index=9&type=section&id=Reconciliation%20of%20Net%20Cash%20Provided%20by%20Operating%20Activities%20to%20Adjusted%20EBITDA) This reconciliation details the adjustments from net cash provided by operating activities to Adjusted EBITDA for quarterly and year-to-date periods Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA (Millions) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | 6M 2025 (Millions) | 6M 2024 (Millions) | | :---------------------------------------------------- | :----------------- | :----------------- | :----------------- | :----------------- | | Net cash provided by operating activities | $270.2 | $217.4 | $558.8 | $456.2 | | Interest expense and amortization of debt discounts and fees | $30.4 | $34.3 | $62.2 | $69.5 | | Current portion of income tax expense | $54.5 | $40.6 | $87.3 | $72.4 | | Adjusted EBITDA | $318.6 | $271.8 | $632.2 | $544.8 | [Reconciliation of Net Income to Adjusted EBITDA](index=14&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20EBITDA) This reconciliation details the adjustments from net income to Adjusted EBITDA for quarterly and year-to-date periods Reconciliation of Net Income to Adjusted EBITDA (Millions) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | 6M 2025 (Millions) | 6M 2024 (Millions) | | :---------------------------------------------------- | :----------------- | :----------------- | :----------------- | :----------------- | | Net income | $184.9 | $146.5 | $381.4 | $285.3 | | Provision for income tax expense | $51.0 | $38.3 | $92.6 | $76.6 | | Interest expense and amortization of debt discounts and fees | $30.4 | $34.3 | $62.2 | $69.5 | | Depreciation and amortization | $79.9 | $72.9 | $159.1 | $143.2 | | Adjusted EBITDA | $318.6 | $271.8 | $632.2 | $544.8 | [Adjusted Earnings Per Share Reconciliations](index=7&type=section&id=Adjusted%20Earnings%20Per%20Share%20Reconciliations) This section provides detailed reconciliations for both GAAP and non-GAAP earnings per share, adjusting for specific items to present a clearer view of ongoing operating performance across various periods [Earnings Per Share (GAAP)](index=7&type=section&id=Earnings%20Per%20Share) This table presents the GAAP earnings per share from continuing operations for both quarterly and year-to-date periods Earnings Per Share (GAAP) (Millions) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | 6M 2025 (Millions) | 6M 2024 (Millions) | | :---------------------------------------------------- | :----------------- | :----------------- | :----------------- | :----------------- | | Income from continuing operations attributable to Encompass Health | $143.0 | $115.3 | $295.0 | $229.1 | | Basic earnings per share from continuing operations | $1.42 | $1.14 | $2.92 | $2.28 | | Diluted earnings per share from continuing operations | $1.40 | $1.13 | $2.88 | $2.24 | [Adjusted Earnings Per Share (Non-GAAP)](index=8&type=section&id=Adjusted%20Earnings%20Per%20Share) This table presents the adjusted non-GAAP earnings per share for both quarterly and year-to-date periods Adjusted Earnings Per Share (Non-GAAP) | Metric | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :---------------------------------------------------- | :------ | :------ | :------ | :------ | | Earnings per share, as reported | $1.40 | $1.13 | $2.88 | $2.24 | | Adjusted earnings per share | $1.40 | $1.11 | $2.77 | $2.23 | [Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share (Q2 2025)](index=10&type=section&id=Reconciliation%20of%20Income%20from%20Continuing%20Operations%20Attributable%20to%20Encompass%20Health%20per%20Diluted%20Share%20to%20Adjusted%20Earnings%20Per%20Share%20(Q2%202025)) This reconciliation details adjustments from reported diluted EPS to adjusted diluted EPS for Q2 2025 Q2 2025 Adjusted Earnings Per Share Reconciliation (Millions) | Metric | As Reported (Millions) | Income Tax Adjustments (Millions) | Change in Fair Market Value of Equity Securities (Millions) | As Adjusted (Millions) | | :---------------------------------------------------- | :--------------------- | :-------------------------------- | :------------------------------------------ | :--------------------- | | Income from continuing operations attributable to Encompass Health | $143.0 | $0.4 | $(0.2) | $143.2 | | Diluted earnings per share from continuing operations | $1.40 | — | — | $1.40 | [Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share (Q2 2024)](index=11&type=section&id=Reconciliation%20of%20Income%20from%20Continuing%20Operations%20Attributable%20to%20Encompass%20Health%20per%20Diluted%20Share%20to%20Adjusted%20Earnings%20Per%20Share%20(Q2%202024)) This reconciliation details adjustments from reported diluted EPS to adjusted diluted EPS for Q2 2024 Q2 2024 Adjusted Earnings Per Share Reconciliation (Millions) | Metric | As Reported (Millions) | Income Tax Adjustments (Millions) | Change in Fair Market Value of Equity Securities (Millions) | As Adjusted (Millions) | | :---------------------------------------------------- | :--------------------- | :-------------------------------- | :------------------------------------------ | :--------------------- | | Income from continuing operations attributable to Encompass Health | $115.3 | $(2.4) | $0.3 | $113.2 | | Diluted earnings per share from continuing operations | $1.13 | $(0.02) | — | $1.11 | [Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share (6M 2025)](index=12&type=section&id=Reconciliation%20of%20Income%20from%20Continuing%20Operations%20Attributable%20to%20Encompass%20Health%20per%20Diluted%20Share%20to%20Adjusted%20Earnings%20Per%20Share%20(6M%202025)) This reconciliation details adjustments from reported diluted EPS to adjusted diluted EPS for the six months ended June 30, 2025 6M 2025 Adjusted Earnings Per Share Reconciliation (Millions) | Metric | As Reported (Millions) | Income Tax Adjustments (Millions) | Change in Fair Market Value of Equity Securities (Millions) | As Adjusted (Millions) | | :---------------------------------------------------- | :--------------------- | :-------------------------------- | :------------------------------------------ | :--------------------- | | Income from continuing operations attributable to Encompass Health | $295.0 | $(11.6) | $(0.7) | $282.7 | | Diluted earnings per share from continuing operations | $2.88 | $(0.11) | $(0.01) | $2.77 | [Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share (6M 2024)](index=13&type=section&id=Reconciliation%20of%20Income%20from%20Continuing%20Operations%20Attributable%20to%20Encompass%20Health%20per%20Diluted%20Share%20to%20Adjusted%20Earnings%20Per%20Share%20(6M%202024)) This reconciliation details adjustments from reported diluted EPS to adjusted diluted EPS for the six months ended June 30, 2024 6M 2024 Adjusted Earnings Per Share Reconciliation (Millions) | Metric | As Reported (Millions) | Asset Impairment Impact (Millions) | Income Tax Adjustments (Millions) | Change in Fair Market Value of Equity Securities (Millions) | As Adjusted (Millions) | | :---------------------------------------------------- | :--------------------- | :------------------------- | :-------------------------------- | :------------------------------------------ | :--------------------- | | Income from continuing operations attributable to Encompass Health | $229.1 | $1.8 | $(3.0) | $0.1 | $228.0 | | Diluted earnings per share from continuing operations | $2.24 | $0.02 | $(0.03) | — | $2.23 | [Adjusted Free Cash Flow Reconciliation](index=15&type=section&id=Reconciliation%20of%20Net%20Cash%20Provided%20by%20Operating%20Activities%20to%20Adjusted%20Free%20Cash%20Flow) The reconciliation shows an increase in adjusted free cash flow for both the three and six months ended June 30, 2025, compared to the prior year, with details on investing and financing activities Adjusted Free Cash Flow Reconciliation (Millions) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | 6M 2025 (Millions) | 6M 2024 (Millions) | | :---------------------------------------------------- | :----------------- | :----------------- | :----------------- | :----------------- | | Net cash provided by operating activities | $270.2 | $217.4 | $558.8 | $456.2 | | Impact of discontinued operations | $1.2 | $2.0 | $1.9 | $2.7 | | Net cash provided by operating activities of continuing operations | $271.4 | $219.4 | $560.7 | $458.9 | | Capital expenditures for maintenance | $(45.1) | $(48.9) | $(79.1) | $(87.6) | | Distributions paid to noncontrolling interests of consolidated affiliates | $(40.4) | $(27.8) | $(73.3) | $(52.5) | | Adjusted free cash flow | $185.9 | $142.5 | $408.3 | $310.1 | - Net cash used in investing activities was **$165.4 million for Q2 2025** and **$323.9 million for 6M 2025**, primarily due to capital expenditures[29](index=29&type=chunk)[31](index=31&type=chunk) - Net cash used in financing activities was **$90.2 million for Q2 2025** and **$220.6 million for 6M 2025**, primarily from distributions to noncontrolling interests, stock repurchases, net debt payments, and cash dividends[29](index=29&type=chunk)[31](index=31&type=chunk) [Corporate Disclosures](index=2&type=section&id=Corporate%20Disclosures) This section provides details on the upcoming earnings conference call and includes important forward-looking statements and risk disclosures [Earnings Conference Call and Webcast](index=2&type=section&id=Earnings%20conference%20call%20and%20webcast) Encompass Health will host an investor conference call and webcast on August 5, 2025, to discuss its second-quarter 2025 results, with details provided for access - An investor conference call will be held at **10:00 a.m. Eastern Time on Tuesday, August 5, 2025**, to discuss Q2 2025 results[5](index=5&type=chunk) - Access to the conference call is available by dialing **800 343-4849 (domestic)** or **203 518-9848 (international)** using conference ID EHCQ225, or via live webcast at http://investor.encompasshealth.com[6](index=6&type=chunk) [Forward-Looking Statements](index=16&type=section&id=Forward-Looking%20Statements) This section contains a standard disclaimer that statements in the report regarding future events are forward-looking and subject to various risks and uncertainties, meaning actual results may differ materially from projections - Statements in the press release and supplemental information that are not historical facts are **forward-looking statements**, subject to risks and uncertainties[34](index=34&type=chunk) - Actual events or results may differ materially due to factors such as infectious disease outbreaks, demand for services, legal proceedings, ability to attract and retain personnel, cybersecurity risks, and changes in healthcare regulation and reimbursement[34](index=34&type=chunk)[36](index=36&type=chunk) - Encompass Health undertakes **no duty to publicly update or revise** such forward-looking information[34](index=34&type=chunk)

Core Viewpoint - Encompass Health Corporation reported strong financial results for Q2 2025, with significant revenue growth and increased guidance for the full year, reflecting the company's operational efficiency and expansion efforts [1][3]. Financial Performance - Net operating revenue for Q2 2025 was $1,457.7 million, up from $1,301.2 million in Q2 2024, representing a growth of $156.5 million or 12.0% [2]. - Income from continuing operations attributable to Encompass Health per diluted share increased to $1.40, a rise of 23.9% from $1.13 in the same quarter last year [2]. - Adjusted earnings per share for Q2 2025 were $1.40, compared to $1.11 in Q2 2024, marking a 26.1% increase [2]. - Cash flows from operating activities rose by 24.3% to $270.2 million, primarily due to increased net income [2][9]. - Adjusted EBITDA for Q2 2025 was $318.6 million, up 17.2% from $271.8 million in Q2 2024 [2][9]. Operational Highlights - The company opened a new 60-bed hospital in Fort Myers, Florida, and added 26 beds to an existing facility, enhancing its capacity to serve patients [3]. - Total discharges increased by 7.2%, with same-store discharge growth of 4.7% [2][9]. - Net patient revenue per discharge grew by 4.2%, reaching $21,670 in Q2 2025 [2]. Updated Guidance - Encompass Health raised its full-year guidance for 2025, with updated expectations for net operating revenue between $5,880 million and $5,980 million, and adjusted EBITDA between $1,220 million and $1,250 million [3]. - Adjusted earnings per share guidance was also increased to a range of $5.12 to $5.34 [3]. Company Overview - Encompass Health is the largest owner and operator of inpatient rehabilitation hospitals in the U.S., with 169 hospitals across 38 states and Puerto Rico [6]. - The company is recognized for its high-quality rehabilitative care and has received accolades from Fortune and Forbes for its reputation [6].

Core Viewpoint - Bragar Eagel & Squire, P.C. is investigating potential claims against Encompass Health Corporation due to allegations of violations of federal securities laws and unlawful business practices following negative reports about the company's hospital performance [1][3]. Group 1: Allegations and Impact - A New York Times article published on July 15, 2025, reported that Encompass's for-profit hospitals perform below average on key safety measures, with 34 facilities rated by Medicare as having significantly worse rates of potentially preventable readmissions [3]. - The article highlighted "alarming mistakes" that have led to patient fatalities, raising serious concerns about the company's operational practices [3]. - Following the publication of this article, Encompass's stock price dropped by $12.39, or 10.4%, closing at $107.28 per share, resulting in financial losses for investors [4]. Group 2: Legal Actions and Contact Information - Investors who purchased or acquired Encompass shares and suffered losses are encouraged to contact Bragar Eagel & Squire for discussions regarding their legal rights and potential claims [1][5]. - The law firm specializes in representing individual and institutional investors in complex litigation, indicating a focus on protecting shareholder interests [6].

Core Viewpoint - Pomerantz LLP is investigating claims of potential securities fraud and unlawful business practices by Encompass Health Corporation and its officers or directors [1] Group 1: Allegations and Impact - A New York Times article published on July 15, 2025, alleged that Encompass's for-profit hospitals perform below average on key safety measures, including high rates of potentially preventable readmissions [3] - The article highlighted that Encompass owns 34 facilities rated by Medicare as having statistically significantly worse rates of potentially preventable readmissions [3] - Following the publication of the article, Encompass's stock price dropped by $12.39 per share, or 10.35%, closing at $107.28 per share on the same day [4]

Core Viewpoint - Wall Street anticipates a year-over-year increase in earnings for Encompass Health (EHC) due to higher revenues, with a focus on how actual results will compare to estimates impacting stock price [1][2]. Earnings Expectations - Encompass Health is expected to report quarterly earnings of $1.20 per share, reflecting an 8.1% increase year-over-year, with revenues projected at $1.43 billion, a 9.7% rise from the previous year [3]. - The earnings report is scheduled for August 4, and better-than-expected results could lead to a stock price increase, while disappointing results may cause a decline [2]. Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating a stable outlook from covering analysts [4]. - The Most Accurate Estimate for Encompass Health is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -0.24%, suggesting a bearish sentiment among analysts [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [10]. - Encompass Health currently holds a Zacks Rank of 2, but the negative Earnings ESP complicates predictions for beating the consensus EPS estimate [12]. Historical Performance - Encompass Health has consistently beaten consensus EPS estimates, achieving this in the last four quarters [14]. - In the last reported quarter, the company exceeded expectations by delivering earnings of $1.37 per share against an expected $1.19, resulting in a surprise of +15.13% [13]. Conclusion - While Encompass Health does not appear to be a compelling earnings-beat candidate, investors should consider various factors beyond earnings results when making investment decisions [17].

Core Viewpoint - Encompass Health Corporation is under investigation for potential securities fraud and unlawful business practices following allegations of poor performance in safety measures at its facilities, leading to a significant drop in stock price [1][2][3]. Group 1: Investigation and Allegations - Pomerantz LLP is investigating claims on behalf of investors of Encompass Health Corporation regarding possible securities fraud or unlawful business practices [1]. - The New York Times reported that Encompass's for-profit hospitals perform below average on key safety measures, with 34 facilities rated by Medicare as having significantly worse rates of preventable readmissions [2]. Group 2: Stock Price Impact - Following the publication of the allegations, Encompass's stock price fell by $12.39 per share, representing a 10.35% decrease, closing at $107.28 per share on July 15, 2025 [3].