Leerink Partners analyst Whit Mayo has reiterated their neutral stance on EHAB stock, giving a Hold rating yesterday.
Whit Mayo has given his Hold rating due to a combination of factors affecting Enhabit, Inc’s financial performance. The company’s fourth-quarter results showed revenues in line with expectations and a modest EBITDA beat of 2%, but there were areas of concern, particularly in the Home Health segment. This segment experienced a 20% miss in EBITDA compared to Mayo’s model, with revenues falling short by 4% and a decline in Medicare admissions. Despite these challenges, the Hospice segment performed well, with revenues exceeding estimates by nearly 7% and a significant 50% EBITDA beat.
Overall, while there were positive aspects such as the strong performance in the Hospice segment and the modest EBITDA beat, the ongoing pressures in the Home Health segment and flat EBITDA projections over a multi-year cycle contributed to the Hold rating. Mayo’s analysis suggests that the company faces sustained pressures from behavioral adjustments and cost increases, which may limit its growth potential in the near term. Therefore, the Hold rating reflects a cautious outlook, balancing the strengths and weaknesses observed in the company’s recent performance.
According to TipRanks, Mayo is a 4-star analyst with an average return of 2.8% and a 47.35% success rate. Mayo covers the Healthcare sector, focusing on stocks such as Acadia Healthcare, Ardent Health Partners, Inc., and HCA Healthcare.
In another report released yesterday, TD Cowen also maintained a Hold rating on the stock with a $8.00 price target.