📊 AI Stock Rating — Summary

In Q3 2025, EHC recorded a revenue of $1.48 billion with a net income of $126.5 million, resulting in an EPS of $1.26. The net margin stood at 8.6%. Notably, free cash flow was negative at -$748.4 million due to high capital expenditures and significant cash outflows in operations. Year-over-year growth appears modest as revenue levels have maintained stability rather than showing significant expansion. Profitability margins remain healthy, yet the negative cash flow raises an alert on operational efficiency. The company’s balance sheet shows total assets of $6.87 billion with total liabilities amounting to $3.68 billion, resulting in a debt/equity ratio of approximately 0.69, indicating moderate leverage. Despite these challenges, EHC's dividends, totaling $0.72 over the last year, indicate steady shareholder returns. Analyst price targets suggest possible growth, with a high target of $150 implying confidence from the market. However, the company needs to address its operating cash flow concerns to sustain longer-term growth and investor interest.

AI Score Breakdown

Revenue Growth — Score: 5/10

Revenue growth appears stable but lacks significant upward momentum. The constant revenue stream suggests stability but not dynamic growth, mainly supported by routine business activities.

Profitability — Score: 7/10

Profit margins are fairly healthy with an 8.6% net margin and stable EPS. However, the pressure on cash flow could impede profitability if not addressed.

Cash Flow Quality — Score: 3/10

Free cash flow is significantly negative, driven by substantial operating cash outflows. This raises concerns on liquidity and operational efficiency, suggesting immediate management introspection is needed.

Leverage & Balance Sheet — Score: 7/10

The company's leverage is moderate with a debt/equity ratio of 0.69 and manageable net debt. Financial resilience is decent, though cash flow issues need resolution.

Shareholder Returns — Score: 5/10

The company paid $0.72 in dividends over the last year. Analysts' high price targets provide some optimistic future growth perspectives. However, negative cash flow may limit immediate performance benefits to shareholders.

Analyst Sentiment & Valuation — Score: 8/10

Analyst targets up to $150 suggest further upside may be possible. The optimism reflected in target prices indicates favorable long-term valuation despite short-term operational challenges.

⚠ AI-generated — informational only, not financial advice.