Encompass Health Corp (EHC)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 46.01% | 19.44% | 95.35% | 95.91% | 95.68% |
| Operating profit margin | 16.09% | 15.24% | 14.44% | 16.07% | 14.25% |
| Pretax margin | 13.95% | 12.65% | 10.37% | 12.83% | 10.18% |
| Net profit margin | 8.48% | 7.33% | 6.23% | 8.05% | 6.12% |
Encompass Health Corp has shown a consistent and strong gross profit margin over the years, ranging from 95.68% in 2020 to 95.91% in 2021. However, there was a slight dip to 95.35% in 2022, followed by a significant decrease to 19.44% in 2023, and a recovery to 46.01% in 2024.
In terms of operating profit margin, the company has maintained a stable performance, with figures of 14.25% in 2020, 16.07% in 2021, 14.44% in 2022, 15.24% in 2023, and 16.09% in 2024.
The pretax margin has shown a positive trend, increasing from 10.18% in 2020 to 13.95% in 2024, with some fluctuations in between (12.83% in 2021, 10.37% in 2022, and 12.65% in 2023).
The net profit margin has also demonstrated a consistent growth pattern, rising from 6.12% in 2020 to 8.48% in 2024, with intermediary figures of 8.05% in 2021, 6.23% in 2022, and 7.33% in 2023.
Overall, Encompass Health Corp has shown satisfactory profitability ratios, albeit with some fluctuations in gross profit margins. The company's ability to maintain and improve its operating, pretax, and net profit margins over the years reflects its effective cost management and operational efficiency.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 13.23% | 11.99% | 11.14% | 11.99% | 10.27% |
| Return on assets (ROA) | 6.97% | 5.77% | 4.81% | 6.00% | 4.41% |
| Return on total capital | 42.91% | 45.57% | 48.10% | 34.50% | 36.03% |
| Return on equity (ROE) | 22.05% | 21.37% | 20.68% | 21.57% | 17.90% |
Encompass Health Corp's profitability ratios show a positive trend over the years analyzed.
1. Operating return on assets (Operating ROA) has improved from 10.27% in December 31, 2020, to 13.23% in December 31, 2024. This indicates the company's ability to generate operating income relative to its total assets has strengthened.
2. Return on assets (ROA) has also shown an upward trajectory, rising from 4.41% in December 31, 2020, to 6.97% in December 31, 2024. This metric reveals the company's overall efficiency in generating profits from its assets has enhanced.
3. Return on total capital has fluctuated but remained relatively high, reaching 48.10% in December 31, 2022. This ratio reflects the company's ability to generate returns from both debt and equity capital invested in the business.
4. Return on equity (ROE) has exhibited steady growth from 17.90% in December 31, 2020, to 22.05% in December 31, 2024. This metric measures the company's ability to generate profit from shareholders' equity and indicates an increase in shareholder value over the years.
Overall, Encompass Health Corp's profitability ratios demonstrate a positive and improving financial performance, with a focus on utilizing assets efficiently, generating returns for capital providers, and enhancing shareholder value.