Encompass Health Expands Partnership With Piedmont in Georgia

Encompass Health Corporation EHC recently strengthened its collaboration with Piedmont by launching the Rehabilitation Hospital of Athens, GA, through a joint venture (JV) agreement. As Georgia’s largest healthcare system, Piedmont has been a long-term ally of Encompass Health.

The newly opened 40-bed inpatient rehabilitation facility in Athens, GA, is designed to assist patients in recovering from various medical conditions, including amputations, brain injuries, complex orthopedic issues, spinal cord injuries, and strokes. Patients at the facility will benefit from at least three hours of intensive therapy five days a week, as well as continuous nursing care and regular physician consultations. The integration of these services with Piedmont’s acute care offerings in the region is expected to enhance patient outcomes significantly.

This development reinforces the ongoing partnership between Encompass Health and Piedmont, which already includes multiple JV rehabilitation hospitals. Currently, EHC operates 167 inpatient rehabilitation hospitals across 38 states and Puerto Rico. Expanding its collaboration with Piedmont will enable EHC to further establish its presence in Georgia. Future projects under this partnership include the construction of additional hospitals in Loganville, GA.

Encompass Health remains committed to its growth strategy as the demand for inpatient rehabilitation services continues to rise due to the aging population and limited access to such facilities in the United States. The company aims to enhance its capacity by establishing seven new hospitals (de novos) with a total of 340 beds and expanding existing facilities by 100 beds in 2025. Between 2023 and 2027, EHC plans to open six to 10 new hospitals annually while adding 80-120 beds each year. Strategic initiatives like this joint venture will help the company accelerate progress toward these expansion goals.

Shares of Encompass Health have gained 26.4% in the past year compared with the industry’s 5.5% growth. EHC currently carries a Zacks Rank #3 (Hold).

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Stocks to Consider

Some better-ranked stocks in the broader Medical sector are Pediatrix Medical Group, Inc. MD, The Ensign Group, Inc. ENSG and Addus HomeCare Corporation ADUS. While Pediatrix Medical currently sports a Zacks Rank #1 (Strong Buy), Ensign and Addus HomeCare carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Pediatrix Medical’s current-year earnings increased 3 cents in the past week. MD beat earnings estimates in each of the trailing four quarters, with an average surprise of 19.4%. The consensus mark for its current-year revenues is pegged at $1.9 billion.

The Zacks Consensus Estimate for Ensign’s current-year earnings indicates 13.5% year-over-year growth. ENSG beat earnings estimates in each of the trailing four quarters, with an average surprise of 1.5%. The consensus mark for revenues implies a 14.3% increase from the year-ago period.

The Zacks Consensus Estimate for Addus HomeCare’s current-year earnings indicates a 13.5% increase from the year-ago reported figure. ADUS beat earnings estimates in three of the trailing four quarters and met once, with an average surprise of 5.8%. The consensus mark for its current-year revenues is pegged at $1.4 billion, which indicates 21.7% year-over-year growth.

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This article originally published on Zacks Investment Research (zacks.com).

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