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Why You Should Add Ensign Group (ENSG) to Your Portfolio Now
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The Ensign Group, Inc. (ENSG - Free Report) is aided by growth in service revenues, acquisitions of healthcare facilities and an impressive financial position. A positive business outlook for 2024 reinforces investors’ confidence in the stock.
Zacks Rank & Price Performance
Ensign Group currently carries a Zacks Rank #2 (Buy).
The stock has rallied 21.7% in the past year.
Image Source: Zacks Investment Research
Favorable Style Score
Ensign Group carries an impressive Value Score of B. Value Score helps find stocks that are undervalued. Back-tested results have shown so far that stocks with a favorable Value Score, combined with a solid Zacks Rank, are the best investment bets.
Robust Prospects
The Zacks Consensus Estimate for ENSG’s 2024 earnings is pegged at $5.38 per share, suggesting growth of 12.8%, while the same for revenues is $4.2 billion, implying a rise of 11.2% from the respective year-ago reported figures.
The consensus mark for 2025 earnings is $5.90 per share, indicating an improvement of 9.7%, while the same for revenues is $4.5 billion, hinting at a 8% increase from the respective 2024 estimates.
Impressive Earnings Surprise History
Ensign Group’s bottom line outpaced estimates in each of the trailing four quarters, the average surprise being 1.74%.
Solid Return on Equity
The return on equity for ENSG is 19.3% against the industry’s negative return of 15.4%, thereby substantiating its efficiency in utilizing shareholders’ funds.
A Strong View for 2024
Ensign Group anticipates revenues within $4.13-$4.17 billion this year, the midpoint of which indicates an improvement of 11.3% from the 2023 figure.
Adjusted earnings per share are estimated between $5.29 and $5.47, the midpoint of which suggests 13% growth from the 2023 level.
Key Business Tailwinds
Revenues of Ensign Group benefits on the back of improved service revenues, derived from rendering enhanced healthcare services at the company’s skilled nursing, rehabilitation and senior living facilities.
An aging U.S. population is expected to sustain the solid demand for ENSG’s senior living services while the dire need for effective rehabilitation services that empower individuals to resume daily life activities may continue to provide an impetus to the Skilled Services segment in the days ahead.
Through the Standard Bearer unit, the company earns rental revenues from leasing the post-acute care properties that it had purchased to healthcare operators under triple-net lease arrangements. ENSG stands out as a gainer in such agreements for not only does the company receives rental revenues but also the tenant bears the costs related to the abovementioned properties.
The inorganic growth strategy of Ensign Group looks impressive. ENSG purchases facilities situated in different U.S. regions and benefits from the opportunity to work with a local team of caregivers. This provides it with in-depth understanding of the diversified regional needs and enables it to extend high-quality healthcare services to communities with inadequate care access. Acquisitions remain a top priority for the management while deploying capital.
Such expansion initiatives have also broadened the healthcare portfolio of Ensign Group, which currently comprises 302 healthcare operations scattered across 14 states, out of which the count of senior living operations is 27. It also owns 114 real-estate assets.
A solid financial position remains a compulsion to undertake uninterrupted business investments. The financial strength of ENSG is substantiated by solid cash reserves and robust cash-generating abilities, which equip it to return value to shareholders through share buybacks and dividend payments. ENSG generated operating cash flows of $376.7 million in 2023, which improved 38.2% year over year. Its dividend yield of 0.2% compares favorably with the industry’s figure of 0.17%.
The leverage ratio of Ensign Group has been improving for a while. Its total debt-to-total capital of 9.1% at the fourth-quarter end remains lower than the industry average of 82%.
LeMaitre Vascular’s earnings surpassed estimates in each of the last four quarters, the average surprise being 8.91%. The Zacks Consensus Estimate for LMAT’s 2024 earnings indicates a rise of 21.5% while the consensus mark for revenues suggests an improvement of 9.4% from the respective year-ago actuals. The consensus mark for LMAT’s 2024 earnings has moved 8.6% north in the past 60 days.
Medpace’s earnings beat estimates in each of the trailing four quarters, the average surprise being 12.42%. The Zacks Consensus Estimate for MEDP’s 2024 earnings indicates a rise of 18.6% while the consensus mark for revenues suggests an improvement of 15.6% from the respective year-ago actuals. The consensus mark for MEDP’s 2024 earnings has moved 4.8% north in the past 60 days.
The bottom line of Lantheus outpaced estimates in each of the trailing four quarters, the average surprise being 14.84%. The Zacks Consensus Estimate for LNTH’s 2024 earnings indicates a rise of 5.6% while the consensus mark for revenues suggests an improvement of 10.3% from the respective year-ago actuals. The consensus mark for LNTH’s 2024 earnings has moved 5.1% north in the past 60 days.
Shares of LeMaitre Vascular and Medpace have gained 21.1% and 110.8%, respectively, in the past year. However, the Lantheus stock has declined 29.7% in the same time frame.
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Why You Should Add Ensign Group (ENSG) to Your Portfolio Now
The Ensign Group, Inc. (ENSG - Free Report) is aided by growth in service revenues, acquisitions of healthcare facilities and an impressive financial position. A positive business outlook for 2024 reinforces investors’ confidence in the stock.
Zacks Rank & Price Performance
Ensign Group currently carries a Zacks Rank #2 (Buy).
The stock has rallied 21.7% in the past year.
Image Source: Zacks Investment Research
Favorable Style Score
Ensign Group carries an impressive Value Score of B. Value Score helps find stocks that are undervalued. Back-tested results have shown so far that stocks with a favorable Value Score, combined with a solid Zacks Rank, are the best investment bets.
Robust Prospects
The Zacks Consensus Estimate for ENSG’s 2024 earnings is pegged at $5.38 per share, suggesting growth of 12.8%, while the same for revenues is $4.2 billion, implying a rise of 11.2% from the respective year-ago reported figures.
The consensus mark for 2025 earnings is $5.90 per share, indicating an improvement of 9.7%, while the same for revenues is $4.5 billion, hinting at a 8% increase from the respective 2024 estimates.
Impressive Earnings Surprise History
Ensign Group’s bottom line outpaced estimates in each of the trailing four quarters, the average surprise being 1.74%.
Solid Return on Equity
The return on equity for ENSG is 19.3% against the industry’s negative return of 15.4%, thereby substantiating its efficiency in utilizing shareholders’ funds.
A Strong View for 2024
Ensign Group anticipates revenues within $4.13-$4.17 billion this year, the midpoint of which indicates an improvement of 11.3% from the 2023 figure.
Adjusted earnings per share are estimated between $5.29 and $5.47, the midpoint of which suggests 13% growth from the 2023 level.
Key Business Tailwinds
Revenues of Ensign Group benefits on the back of improved service revenues, derived from rendering enhanced healthcare services at the company’s skilled nursing, rehabilitation and senior living facilities.
An aging U.S. population is expected to sustain the solid demand for ENSG’s senior living services while the dire need for effective rehabilitation services that empower individuals to resume daily life activities may continue to provide an impetus to the Skilled Services segment in the days ahead.
Through the Standard Bearer unit, the company earns rental revenues from leasing the post-acute care properties that it had purchased to healthcare operators under triple-net lease arrangements. ENSG stands out as a gainer in such agreements for not only does the company receives rental revenues but also the tenant bears the costs related to the abovementioned properties.
The inorganic growth strategy of Ensign Group looks impressive. ENSG purchases facilities situated in different U.S. regions and benefits from the opportunity to work with a local team of caregivers. This provides it with in-depth understanding of the diversified regional needs and enables it to extend high-quality healthcare services to communities with inadequate care access. Acquisitions remain a top priority for the management while deploying capital.
Such expansion initiatives have also broadened the healthcare portfolio of Ensign Group, which currently comprises 302 healthcare operations scattered across 14 states, out of which the count of senior living operations is 27. It also owns 114 real-estate assets.
A solid financial position remains a compulsion to undertake uninterrupted business investments. The financial strength of ENSG is substantiated by solid cash reserves and robust cash-generating abilities, which equip it to return value to shareholders through share buybacks and dividend payments. ENSG generated operating cash flows of $376.7 million in 2023, which improved 38.2% year over year. Its dividend yield of 0.2% compares favorably with the industry’s figure of 0.17%.
The leverage ratio of Ensign Group has been improving for a while. Its total debt-to-total capital of 9.1% at the fourth-quarter end remains lower than the industry average of 82%.
Other Stocks to Consider
Some other top-ranked stocks in the Medical space are LeMaitre Vascular, Inc. (LMAT - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and Lantheus Holdings, Inc. (LNTH - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
LeMaitre Vascular’s earnings surpassed estimates in each of the last four quarters, the average surprise being 8.91%. The Zacks Consensus Estimate for LMAT’s 2024 earnings indicates a rise of 21.5% while the consensus mark for revenues suggests an improvement of 9.4% from the respective year-ago actuals. The consensus mark for LMAT’s 2024 earnings has moved 8.6% north in the past 60 days.
Medpace’s earnings beat estimates in each of the trailing four quarters, the average surprise being 12.42%. The Zacks Consensus Estimate for MEDP’s 2024 earnings indicates a rise of 18.6% while the consensus mark for revenues suggests an improvement of 15.6% from the respective year-ago actuals. The consensus mark for MEDP’s 2024 earnings has moved 4.8% north in the past 60 days.
The bottom line of Lantheus outpaced estimates in each of the trailing four quarters, the average surprise being 14.84%. The Zacks Consensus Estimate for LNTH’s 2024 earnings indicates a rise of 5.6% while the consensus mark for revenues suggests an improvement of 10.3% from the respective year-ago actuals. The consensus mark for LNTH’s 2024 earnings has moved 5.1% north in the past 60 days.
Shares of LeMaitre Vascular and Medpace have gained 21.1% and 110.8%, respectively, in the past year. However, the Lantheus stock has declined 29.7% in the same time frame.