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Encompass Health Reports First Quarter 2026 Results

Encompass Health Corporation (NYSE: EHC), the largest owner and operator of inpatient rehabilitation hospitals in the United States, announced its financial performance for the first quarter that ended on March 31, 2026, displaying an impressive upward trend. The company recorded significant growth in several key financial metrics, reflecting its commitment to providing quality rehabilitative care to patients recovering from serious injuries or illnesses.

Financial Overview

For the first quarter of 2026, Encompass Health reported net operating revenues of $1.586 billion, which is a 9% increase from $1.455 billion in the same period of 2025. This growth translated into increased income from continuing operations, which rose to $232.3 million compared to $197 million in Q1 2025. This healthy increase corresponds to earnings per diluted share of $1.77, up from $1.48 in the previous year, marking a strong 19.6% improvement.

Adjusted earnings per share saw a similar upward trajectory, climbing to $1.60 from $1.37, a growth of 16.8%. These figures demonstrate Encompass Health’s robust operational performance and continued demand for its services.

Operational Metrics

In terms of operational metrics, the company experienced a notable rise in discharges, with a total of 67,763 patients, representing a 4.3% increase from 64,985 in Q1 2025. The same-store discharge growth stood at 1.6%, which highlights the company's organic growth in its existing facilities. Additionally, the net patient revenue per discharge increased to $22,633 from the previous year's $21,816, contributing to the overall revenue uplift.

Growth Strategy

Mark Tarr, the President and CEO of Encompass Health, expressed optimism regarding the company's growth trajectory. He noted, "We are very pleased with our start to 2026, as first-quarter revenue increased 9.0% and Adjusted EBITDA grew 11.2%." This reflects Encompass Health’s ongoing strategy to enhance its capacity to treat patients, which is evident from the opening of a new 49-bed hospital in Irmo, South Carolina, and the addition of 44 beds across existing facilities.

The company expects to maintain this growth momentum throughout the year, with plans to open eight hospitals, adding a total of 389 beds and approximately 175 additional beds in existing hospitals. This demonstrates Encompass Health's commitment to expanding its reach and enhancing its service capacity in the rehabilitation sector.

Updated Guidance for 2026

Encouraged by its strong Q1 performance, Encompass Health has also increased its full-year guidance. The updated projections estimate net operating revenue between $6.375 billion and $6.470 billion, with Adjusted EBITDA targeted to be within $1.350 billion to $1.380 billion. These revisions illustrate the company’s confidence in its business model and operational strategy for the remainder of the year.

Tarr concluded, "Our value proposition and operating strategy continue to be validated, and we remain highly optimistic about the long-term prospects of our business." This positive outlook sets an encouraging tone for investors and stakeholders in the healthcare industry.

Investor Engagement

For investors and analysts seeking further insights, Encompass Health will host a conference call at 10:00 a.m. Eastern Time on May 1, 2026, to discuss these results in detail. Interested parties can access the call by dialing the designated conference number and are encouraged to review the supplemental information that will be provided on the company’s investor relations website.

As the leading provider of rehabilitative services, Encompass Health's sustained performance and strategic expansion plans are conclusive indicators of its ongoing commitment to improving patient care and enhancing value for shareholders.

About Encompass Health

Encompass Health operates 174 hospitals across 39 states and Puerto Rico, providing exceptional rehabilitative care. With recognition as America’s Most Awarded Leader in Inpatient Rehabilitation by Newsweek and Statista, the company continues its mission to deliver patient-centered care through innovation and advanced technology. For more information about its services and initiatives, please visit their official website.