Encompass HealthMEX:EHC 88 Return-on-Tangible-Equity is 90.74% as of Mar. 2026, which is 43% below its 10-year median of 159.28. GuruFocus rates MEX:EHC with a GF Score™ of 88/100 and a GF Value™ of MXN1,345.00. The stock has 1 warning sign investors should review. Among 579 Healthcare Providers & Services companies, Encompass Health ranks better than 85.15% on this metric.
Return-on-Tangible-Equity is calculated as Net Income divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. Encompass Health's annualized net income for the quarter that ended in Mar. 2026 was MXN14,029 Mil. Encompass Health's average shareholder tangible equity for the quarter that ended in Mar. 2026 was MXN15,462 Mil. Therefore, Encompass Health's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 90.74%.
The historical rank and industry rank for Encompass Health's Return-on-Tangible-Equity or its related term are showing as below:
MEX:EHC'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 81.08 Med: 159.28 Max: 193.09
Current: 81.08
During the past 13 years, Encompass Health's highest Return-on-Tangible-Equity was 193.09%. The lowest was 81.08%. And the median was 159.28%.
MEX:EHC's Return-on-Tangible-Equity is ranked better than 85.15% of 579
companies
in the Healthcare Providers & Services industry
Industry Median: 10.13
vs MEX:EHC: 81.08
Encompass Health (MEX:EHC) Return-on-Tangible-Equity Explanation
Return-on-Tangible-Equity measures the rate of return on the ownership interest (shareholder's tangible equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' tangible equity (shareholders equity minus intangibles). Return-on-Tangible-Equity shows how well a company uses investment funds to generate earnings growth. Return-on-Tangible-Equitys between 15% and 20% are considered desirable.
Be Aware
Net Income is used.
Because a company can increase its Return-on-Tangible-Equity by having more financial leverage, it is important to watch the leverage ratio when investing in high Return-on-Tangible-Equity companies. Like Return-on-Tangible-Asset, Return-on-Tangible-Equity is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their Return-on-Tangible-Equitys can be extremely high.
Encompass Health Return-on-Tangible-Equity Related Terms
Encompass Health Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Encompass Health's Return-on-Tangible-Equity can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
MEX:EHC vs ENSG, UHS, PACS: Return-on-Tangible-Equity Comparison
For the Medical Care Facilities subindustry, Encompass Health's Return-on-Tangible-Equity, along with its competitors' market caps and Return-on-Tangible-Equity data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Encompass Health Return-on-Tangible-Equity vs Healthcare Providers & Services Industry
For the Healthcare Providers & Services industry and Healthcare sector, Encompass Health's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Encompass Health's Return-on-Tangible-Equity falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual Return-on-Tangible-Equity, the net income of the last fiscal year and the average total shareholder tangible equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Mar. 2026) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of 90.74% mean?
Encompass Health (MEX:EHC) has a Return-on-Tangible-Equity of 90.74% as of Mar. 2026. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Encompass Health and its competitors. This is 43% below median its historical median of 159.28. Over the past decade, Encompass Health's Return-on-Tangible-Equity has ranged from 81.08 to 193.09. According to the industry distribution chart, Encompass Health ranks #86 out of 579 companies in the Healthcare Providers & Services industry, placing it in the top 14.9%.
Is Encompass Health's Return-on-Tangible-Equity too high?
Encompass Health's current Return-on-Tangible-Equity of 90.74% is 43% below median its 10-year median of 159.28. Over the past 10 years, this metric has ranged from a low of 81.08 to a high of 193.09. The Healthcare Providers & Services industry median Return-on-Tangible-Equity is 10.13. Encompass Health's value of 90.74% is 795.8% above this industry median. Based on the distribution chart, Encompass Health ranks #86 out of 579 companies in the Healthcare Providers & Services industry, which is in the top quartile — a strong position relative to peers. Overall, Encompass Health has a GF Score™ of 88/100, reflecting its overall financial health beyond just this single metric.
How does Encompass Health's Return-on-Tangible-Equity compare to ENSG and UHS?
According to the Healthcare Providers & Services industry distribution chart, Encompass Health ranks #86 out of 579 companies for Return-on-Tangible-Equity. This places Encompass Health in the top 15% of its industry — outperforming the majority of peers. The industry median Return-on-Tangible-Equity is 10.13. Encompass Health's value of 90.74% is 795.8% above this benchmark. Historically, Encompass Health's own Return-on-Tangible-Equity has ranged from 81.08 to 193.09 over the past decade. While the company's 10-year median is 159.28 vs. the industry median of 10.13, Encompass Health has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Return-on-Tangible-Equity for a Healthcare Providers & Services company?
The median Return-on-Tangible-Equity among Healthcare Providers & Services companies is 10.13, based on 579 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Equity significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Equity should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Encompass Health's current Return-on-Tangible-Equity of 90.74% is 795.8% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Return-on-Tangible-Equity mean?
A high Return-on-Tangible-Equity can signal that a stock is expensive relative to its fundamentals. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Encompass Health and its competitors. For the Healthcare Providers & Services industry, the median Return-on-Tangible-Equity is 10.13 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Encompass Health's current Return-on-Tangible-Equity is 90.74%, which is 43% below median its own 10-year median of 159.28. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Encompass Health stock overvalued right now?
Encompass Health (MEX:EHC) has a current Return-on-Tangible-Equity of 90.74%. The stock's GF Value™ is MXN1,345.00, compared to a current price of MXN1,280.08 — trading 4.8% below its estimated fair value. The current Return-on-Tangible-Equity is 90.74%, which is 43% below median its 10-year median of 159.28 and 795.8% above the Healthcare Providers & Services industry median of 10.13. Encompass Health's overall GF Score™ is 88/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Return-on-Tangible-Equity calculated?
Return-on-Tangible-Equity is calculated from a company's financial statements. For Encompass Health (MEX:EHC), the current Return-on-Tangible-Equity is 90.74% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Encompass Health (MEX:EHC) Overvalued in 2026?
Based on GuruFocus' analysis, Encompass Health stock appears to be undervalued.
The current stock price of MXN1,280.08 is trading 4.8% below its estimated GF Value™ of MXN1,345.00.
Key valuation signals for MEX:EHC:
Return-on-Tangible-Equity: 90.74% (43% below median its 10-year median of 159.28)
GF Value™: MXN1,345.00 vs. price of MXN1,280.08 (4.8% below fair value)
Industry Position: 795.8% above the Healthcare Providers & Services median (#86 of 579)
No single metric tells the full story. See the MEX:EHC stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Encompass Health Corp provides post-acute healthcare services in the United States through a network of inpatient rehabilitation hospitals, which is the company's sole segment. Inpatient rehabilitation contributes the majority of the firm's revenue and provides specialized rehabilitative treatment through a network of inpatient hospitals. The company's inpatient rehabilitation hospitals provide a higher level of rehabilitative care to patients who are recovering from conditions such as stroke and other neurological disorders, cardiac and pulmonary conditions, brain and spinal cord injuries, complex orthopedic conditions, and amputations.
88GF Score
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