Financial Data and Key Metrics Changes - Total revenue grew more than 6% year-over-year in Q4 2025, with full-year revenue increasing over 5% [8][10] - Adjusted EBITDA declined 10% to $104.7 million from $116 million in the prior year, with a margin decrease to 9% from 9.8% [9][10] - Earnings per common share from continuing operations was $0.16, compared to a diluted loss per common share of $0.19 in the prior year [9] Business Line Data and Key Metrics Changes - Inpatient Rehab Hospital Division revenue increased over 15% year-over-year to $339.2 million, with adjusted EBITDA rising 11% to $69.2 million [10] - Critical Illness Recovery Hospital Division revenue increased nearly 5% to $629.7 million, with adjusted EBITDA growing 5% to $66.4 million [11] - Outpatient Rehab Division revenue increased to $324.6 million, driven by nearly 5% growth in patient visits, but adjusted EBITDA fell to $11.2 million from $26.6 million [12] Market Data and Key Metrics Changes - The company added 150 beds in Q4 2025, contributing to a total of 212 rehab beds added for the full year [5][6] - The average daily census in the Inpatient Rehab Hospital Division grew nearly 10%, with occupancy improving to 82% from 81% [10] Company Strategy and Development Direction - The company is focused on expanding its inpatient rehabilitation business, with plans to add 399 beds across 2026 and 2027 [6][8] - A cash dividend of $0.0625 per share was approved, reflecting a commitment to returning value to shareholders [8] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for the outpatient division, indicating that recent health insurance expenses were likely one-time impacts [20] - The company expects revenue for 2026 to be in the range of $5.6 billion to $5.8 billion, with adjusted EBITDA projected between $520 million and $540 million [15] Other Important Information - A non-binding proposal to take the company private is under review by a special committee of the board [4] - The company ended the quarter with $1.8 billion of debt and $26.5 million of cash on the balance sheet [13] Q&A Session Summary Question: Can you provide details on the higher health costs and their impact on the outpatient rehab business? - Management indicated that health insurance expenses impacted the outpatient division by approximately $5 million, with variable discounts adding another $6 million, totaling around $11 million [18] Question: What are the expectations for guidance going forward? - Management expressed confidence in the inpatient rehab division and cautiously optimistic outlook for outpatient improvements, indicating that the $11 million impact was likely a one-time event [20] Question: Can you elaborate on the special committee's review process? - Management stated they could not comment further on the process beyond the initial announcement [25] Question: Was there any impact from weather in Q1? - Management confirmed that there was no significant impact on inpatient divisions, but outpatient experienced some effects due to weather conditions [26] Question: Can you provide more detail on the outpatient issues and payer mix? - Management noted that the outpatient division faced challenges due to a deterioration in payer mix, impacting net revenue per visit [40]

Core Insights - Select Medical Corporation and the Philadelphia Eagles have renewed their partnership, extending it for multiple years, with NovaCare Rehabilitation continuing as the team's Official Physical Therapy Partner [1] Company Overview - Select Medical is one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics in the U.S., with 104 critical illness recovery hospitals, 38 rehabilitation hospitals, and 1,917 outpatient rehabilitation clinics as of December 31, 2025 [1] - NovaCare Rehabilitation operates 440 physical therapy centers nationwide, with 150 located in the Delaware Valley [1] Partnership Details - The renewed agreement includes NovaCare serving as the presenting sponsor for fan content on the Eagles' digital platforms, including sweepstakes and post-game content [1] - Additional brand exposure will be provided through radio spots, end zone videoboards, and signage at Lincoln Financial Field during home games [1] - NovaCare will continue its involvement in community programs, such as the Eagles Autism Challenge [1] Strategic Importance - The partnership emphasizes a shared commitment to excellence and enhancing fan experiences, reflecting a strong bond developed over 25 years [1] - The extension allows both organizations to expand their community engagement and partnership initiatives [1]

Core Viewpoint - Select Medical Holdings Corporation (SEM) is expected to report its fourth-quarter 2025 results on February 19, 2026, with earnings estimated at 23 cents per share and revenues at $1.36 billion [1]. Financial Performance Estimates - The fourth-quarter earnings estimate has decreased by one cent over the past 60 days, indicating a year-over-year increase of 27.8% [2]. - The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year growth of 3.7% [2]. - For the full year 2025, the revenue estimate is $5.42 billion, reflecting an 18.2% year-over-year decline, while the earnings per share estimate is $1.23, implying a rise of 30.9% from the previous year [3]. Earnings Surprise History - Select Medical's earnings have surpassed the Zacks Consensus Estimate in two of the last four quarters, missing in the other two, with an average surprise of 8.7% [3]. Earnings Prediction Model - The current model does not predict an earnings beat for SEM, as it has an Earnings ESP of 0.00% and a Zacks Rank of 4 (Sell) [4]. Segment Performance Insights - The Critical Illness Recovery segment is projected to see a 2.1% year-over-year revenue growth in Q4, with revenues per Patient Day expected to increase by 2.8% [6]. - The Rehabilitation Hospital segment's revenues are anticipated to rise by 11.1% in Q4, with revenues per Patient Day expected to increase by 5.9% [8]. - The Outpatient Rehabilitation segment's adjusted EBITDA is projected to surge by 55.8% year-over-year, although revenues per Visit are expected to dip by 0.8% [9]. Operational Metrics - A 3.8% increase in admissions is expected in Q4, with an occupancy rate projected at 67.3% [7]. - The Rehabilitation Hospital segment is expected to see admissions grow by 10.4% year-over-year, with an occupancy rate expanding by 320 basis points to 84.2% [8]. - Total operating expenses are estimated to decrease to $1.28 billion, primarily due to lower general and administrative expenses, despite a nearly 6% growth in interest expense [10]. Peer Performance Comparison - Ensign Group reported a fourth-quarter adjusted EPS of $1.82, beating estimates by 4%, with a 19.5% year-over-year improvement in earnings [12]. - Encompass Health reported an adjusted EPS of $1.46, exceeding estimates by 13.2%, with a 24.8% year-over-year increase in earnings [13].

Core Viewpoint - Guardforce AI Co., Limited has announced a non-binding Letter of Intent to acquire 100% of MGAI Limited, a company specializing in AI-driven solutions for speech therapy and rehabilitation services, indicating a strategic move to enhance its healthcare-related AI applications [1][4]. Group 1: Acquisition Details - The acquisition aims to integrate MGAI's AI-supported software and service ecosystem into Guardforce AI's existing framework, potentially transforming professional rehabilitation expertise into scalable AI-enabled service capabilities [4]. - The transaction is subject to due diligence, execution of a definitive purchase agreement, and customary closing conditions [4]. Group 2: MGAI's Service Ecosystem - MGAI utilizes advanced AI technology and one of China's largest databases for children's language development assessment, offering a comprehensive service ecosystem that includes proprietary software, cloud-based SaaS tools, and integrated hardware solutions [2]. - The platform has served over 110,000 patients and has more than 20,000 registered rehabilitation professionals, with plans to expand into Hong Kong, Singapore, and Taiwan [3]. Group 3: Guardforce AI Overview - Guardforce AI is an AI-driven technology company with a strong operational foundation in cash logistics and retail sectors, delivering smart solutions and AI applications through its Intelligent Cloud Platform [5]. - The company is focused on balancing stable, recurring revenues with high-growth innovations, demonstrating its commitment to industry transformation [5].

Financial Performance - In Q4, revenue increased by 9.9% to $1.5 billion, and adjusted EBITDA rose by 15.9% to $335.6 million, driven by 5.3% discharge growth and a 4.1% increase in net revenue per discharge [1][5] - For the full year 2025, revenue grew by 10.5%, with EBITDA increasing by 14.9%, supported by operating leverage and disciplined expense management [3][5] - Adjusted free cash flow for the full year was $818 million, reflecting an 18.5% increase [9] Labor and Operational Efficiency - Premium labor costs decreased significantly, down more than $21 million year-over-year in 2025, with Q4 premium labor at $23.8 million, the lowest since Q1 2021 [2][5][7] - The company added approximately 300 same-store registered nurses (RNs) during 2025, contributing to improved operational efficiency [7] Capacity Expansion and Growth Strategy - Management plans to add 517 beds in 2025 through new hospitals and expansions, with ongoing investments expected to meet a growing target demographic [12] - A new 24-bed small-format hospital prototype is set to launch in 2027 as part of a hub-and-spoke strategy [13] 2026 Guidance - For 2026, management guided net revenue of $6.365–6.465 billion, adjusted EBITDA of $1.34–1.38 billion, and adjusted EPS of $5.81–6.10, with a leverage target of approximately 1.83x [4][18] Regulatory and Payer Dynamics - The company reported a 93% affirmation rate for its Alabama hospitals under the RCD model, indicating effective engagement with CMS [16] - Management expressed concerns about challenges with a national Medicare Advantage payer, which affected conversion rates despite referral growth [20]

Core Insights - Encompass Health Corporation reported strong financial performance for Q4 2025, with net operating revenue increasing by 9.9% year-over-year to $1,544.6 million, and adjusted earnings per share rising by 24.8% to $1.46 [2][3] Financial Performance - Net operating revenue for Q4 2025 was $1,544.6 million, compared to $1,405.0 million in Q4 2024, reflecting a growth of $139.6 million [2] - Income from continuing operations attributable to Encompass Health per diluted share increased by 20.3% to $1.42 from $1.18 [2] - Adjusted EBITDA for Q4 2025 was $335.6 million, up 15.9% from $289.6 million in Q4 2024 [2] - Cash flows from operating activities rose by 24.1% to $346.0 million, compared to $278.8 million in the previous year [2] Operational Highlights - The company discharged 67,238 patients in Q4 2025, a 5.3% increase from 63,839 in Q4 2024, with same-store discharge growth of 3.2% [2] - Net patient revenue per discharge increased by 4.1% to $22,273 from $21,399 [2] - Encompass Health added 517 inpatient rehabilitation beds through eight new hospitals and 127 beds to existing facilities during 2025, indicating a significant capacity expansion [3] 2026 Guidance - For 2026, Encompass Health expects net operating revenue between $6,365 million and $6,465 million, and adjusted EBITDA between $1,340 million and $1,380 million [5] - The company anticipates adjusted earnings per share from continuing operations to be in the range of $5.81 to $6.10 [5] Company Overview - Encompass Health is the largest owner and operator of inpatient rehabilitation hospitals in the U.S., with 173 hospitals across 39 states and Puerto Rico [9] - The company is recognized for its high-quality rehabilitative care and has received accolades such as being ranked among Fortune's World's Most Admired Companies and Forbes' America's Best Companies [9]

Core Insights - Encompass Health Corporation (EHC) has opened a new rehabilitation hospital in Lake Worth, Florida, expanding its presence in the state to 26 locations [2][5] - The new facility is equipped with 50 beds and aims to assist patients recovering from complex medical issues, including strokes and major surgeries [2][4] - EHC's approach emphasizes an interdisciplinary care model, providing tailored treatment plans to enhance patients' mobility and quality of life [4] Company Expansion - The Lake Worth facility features advanced rehabilitation technologies, private patient rooms, and comprehensive care services, including in-house dialysis and pharmacy [3][9] - EHC operates a total of 173 rehabilitation hospitals across 39 states and Puerto Rico, positioning itself for sustained growth in the post-acute care segment [5][6] - The company plans to open seven new hospitals and add approximately 127 beds to existing facilities in 2025 [6] Financial Performance - EHC's net operating revenues increased by 10.6% year over year in the first nine months of 2025 [6] - Year-to-date, EHC shares have gained 23.3%, outperforming the industry growth of 10.3% [7] Market Position - EHC currently holds a Zacks Rank of 3 (Hold), with several competitors in the medical space holding higher ranks [10] - The company is well-positioned to meet the rising demand for rehabilitation services as the U.S. population ages and chronic health conditions become more prevalent [4]

Industry Focus - The report highlights the disparity between the promised glamorous rehab in California and the actual reality [1] Location - The rehab facility is located in California [1] Transportation - Individuals were flown in from across the country [1]

Industry Observation - The report highlights a discrepancy between the promised glamorous rehab experience in California and the actual conditions [1] - The phrase "I suggest you get a tent" implies inadequate or substandard accommodation for individuals seeking rehabilitation services [1]

Core Points - Encompass Health Corp. will report its third quarter results for the period ending September 30, 2025, after market close on October 29, 2025 [1] - An investor conference call is scheduled for October 30, 2025, at 10 a.m. ET to discuss the results [1] - The company is the largest owner and operator of inpatient rehabilitation hospitals in the U.S., with 170 hospitals across 39 states and Puerto Rico [3] Company Overview - Encompass Health provides high-quality rehabilitative care for patients recovering from major injuries or illnesses, utilizing advanced technology and innovative treatments [3] - The company has received accolades such as being named America's Most Awarded Leader in Inpatient Rehabilitation by Newsweek and Statista [3] - Encompass Health is recognized among Fortune's World's Most Admired Companies and Forbes' Most Trusted Companies in America [3]