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Ensign Group (ENSG) Up 50% in Past Year: More Growth on the Horizon?
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Shares of The Ensign Group, Inc. (ENSG - Free Report) have gained 50.4% in the past year compared with the industry’s 50.1% growth. The Medical sector and the S&P 500 composite index grew 11% and 27.2%, respectively, in the same time frame. With a market capitalization of $8.4 billion, the average volume of shares traded in the last three months was 0.4 million.
An extensive healthcare network, acquisitions of healthcare facilities and a notable financial position continue to drive Ensign Group. An optimistic 2024 business outlook also reinforces investors’ confidence in the stock.
The leading healthcare services provider, presently carrying a Zacks Rank #2 (Buy), has an impressive track record of beating estimates in each of the trailing four quarters, the average surprise being 1.40%.
Return on equity in the trailing 12 months is currently 19%, which stands higher than the industry’s negative average of 14.6%. This substantiates the company’s efficiency in utilizing shareholders’ funds.
Image Source: Zacks Investment Research
Robust Growth Prospects of ENSG
The Zacks Consensus Estimate for Ensign Group’s 2024 earnings is pegged at $5.44 per share, indicating a 14.1% increase from the 2023 reported figure. The consensus mark for revenues is $4.2 billion, implying 13.1% growth from the year-ago figure. It has witnessed four upward estimate revisions compared with none for 2024 earnings over the past 30 days.
The Zacks Consensus Estimate for 2025 earnings is pegged at $5.99 per share, which implies a 10.1% improvement from the 2024 estimate. The consensus mark for revenues is $4.6 billion, implying a 9.5% rise from the 2024 estimate.
Can ENSG Retain the Momentum?
Ensign Group's revenues continue to benefit from the strong performance in its Skilled Services segment, driven by enhanced skilled nursing, senior living and rehabilitative care provided across its network of 315 healthcare facilities in 14 U.S. states. Management projects 2024 revenues to be between $4.20 billion and $4.22 billion, the mid point of which indicates a 12.9% increase from 2023.
The aging U.S. population is expected to sustain the demand for Ensign Group’s senior living services while the growing need for effective rehabilitation services is likely to boost service revenues.
In its Standard Bearer segment, Ensign Group generates rental income through triple-net lease agreements, under which it leases post-acute care properties to healthcare operators. This arrangement benefits the company as it secures rental income while the tenant covers property-related expenses. Currently, it owns 122 real estate assets and recorded rental revenues of $11.4 million in the first half of 2024, up 12.1% year over year.
Ensign Group boasts a successful track record of acquiring real estate or post-acute care operations, which in turn, has expanded its reach across several U.S. communities. It follows a collaborative approach with a local team of caregivers of the acquired facilities and to get a better understanding of the medical needs, thereby serving patients more effectively. Acquisitions continue to remain a top priority for the management while deploying capital.
To sustain its acquisition strategy, Ensign Group relies on its solid financial foundation, supported by sound cash reserves and cash flow generation abilities. The company reported operating cash flows of $112.2 million in the first half of 2024. It also maintains a commitment to returning capital to shareholders, as evidenced by its 21 consecutive years of dividend growth.
HCA Healthcare’s earnings surpassed the Zacks Consensus Estimate in three of the last four quarters and missed the mark once, the average surprise being 8.24%. The consensus estimate for HCA’s 2024 earnings indicates a rise of 16.8% from the year-ago number. The consensus mark for revenues indicates growth of 8.9% from the year-ago reported figure.
The Zacks Consensus Estimate for HCA’s earnings has moved 2.9% north in the past 30 days. Shares of HCA Healthcare have gained 40% in the past year.
LeMaitre Vascular’s earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 8.87%. The consensus estimate for LMAT’s 2024 earnings indicates a rise of 37% from the year-ago number. The consensus mark for revenues implies an improvement of 13% from the year-ago figure.
The Zacks Consensus Estimate for LMAT’s earnings has moved 4.5% north in the past 30 days. Shares of LeMaitre Vascular have risen 57.2% in the past year.
Tenet Healthcare’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 58.48%. The consensus estimate for THC’s 2024 earnings indicates an improvement of 53.3% from the year-ago figure. The consensus mark for revenues implies growth of 1.4% from the year-ago figure.
The Zacks Consensus Estimate for THC’s earnings has moved 20.6% north in the past 30 days. Shares of Tenet Healthcare have rallied 117.6% in the past year.
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Ensign Group (ENSG) Up 50% in Past Year: More Growth on the Horizon?
Shares of The Ensign Group, Inc. (ENSG - Free Report) have gained 50.4% in the past year compared with the industry’s 50.1% growth. The Medical sector and the S&P 500 composite index grew 11% and 27.2%, respectively, in the same time frame. With a market capitalization of $8.4 billion, the average volume of shares traded in the last three months was 0.4 million.
An extensive healthcare network, acquisitions of healthcare facilities and a notable financial position continue to drive Ensign Group. An optimistic 2024 business outlook also reinforces investors’ confidence in the stock.
The leading healthcare services provider, presently carrying a Zacks Rank #2 (Buy), has an impressive track record of beating estimates in each of the trailing four quarters, the average surprise being 1.40%.
Return on equity in the trailing 12 months is currently 19%, which stands higher than the industry’s negative average of 14.6%. This substantiates the company’s efficiency in utilizing shareholders’ funds.
Image Source: Zacks Investment Research
Robust Growth Prospects of ENSG
The Zacks Consensus Estimate for Ensign Group’s 2024 earnings is pegged at $5.44 per share, indicating a 14.1% increase from the 2023 reported figure. The consensus mark for revenues is $4.2 billion, implying 13.1% growth from the year-ago figure. It has witnessed four upward estimate revisions compared with none for 2024 earnings over the past 30 days.
The Zacks Consensus Estimate for 2025 earnings is pegged at $5.99 per share, which implies a 10.1% improvement from the 2024 estimate. The consensus mark for revenues is $4.6 billion, implying a 9.5% rise from the 2024 estimate.
Can ENSG Retain the Momentum?
Ensign Group's revenues continue to benefit from the strong performance in its Skilled Services segment, driven by enhanced skilled nursing, senior living and rehabilitative care provided across its network of 315 healthcare facilities in 14 U.S. states. Management projects 2024 revenues to be between $4.20 billion and $4.22 billion, the mid point of which indicates a 12.9% increase from 2023.
The aging U.S. population is expected to sustain the demand for Ensign Group’s senior living services while the growing need for effective rehabilitation services is likely to boost service revenues.
In its Standard Bearer segment, Ensign Group generates rental income through triple-net lease agreements, under which it leases post-acute care properties to healthcare operators. This arrangement benefits the company as it secures rental income while the tenant covers property-related expenses. Currently, it owns 122 real estate assets and recorded rental revenues of $11.4 million in the first half of 2024, up 12.1% year over year.
Ensign Group boasts a successful track record of acquiring real estate or post-acute care operations, which in turn, has expanded its reach across several U.S. communities. It follows a collaborative approach with a local team of caregivers of the acquired facilities and to get a better understanding of the medical needs, thereby serving patients more effectively. Acquisitions continue to remain a top priority for the management while deploying capital.
To sustain its acquisition strategy, Ensign Group relies on its solid financial foundation, supported by sound cash reserves and cash flow generation abilities. The company reported operating cash flows of $112.2 million in the first half of 2024. It also maintains a commitment to returning capital to shareholders, as evidenced by its 21 consecutive years of dividend growth.
Other Stocks to Consider
Other top-ranked stocks in the Medical space are HCA Healthcare, Inc. (HCA - Free Report) , LeMaitre Vascular, Inc. (LMAT - Free Report) and Tenet Healthcare Corporation (THC - Free Report) , each currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
HCA Healthcare’s earnings surpassed the Zacks Consensus Estimate in three of the last four quarters and missed the mark once, the average surprise being 8.24%. The consensus estimate for HCA’s 2024 earnings indicates a rise of 16.8% from the year-ago number. The consensus mark for revenues indicates growth of 8.9% from the year-ago reported figure.
The Zacks Consensus Estimate for HCA’s earnings has moved 2.9% north in the past 30 days. Shares of HCA Healthcare have gained 40% in the past year.
LeMaitre Vascular’s earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 8.87%. The consensus estimate for LMAT’s 2024 earnings indicates a rise of 37% from the year-ago number. The consensus mark for revenues implies an improvement of 13% from the year-ago figure.
The Zacks Consensus Estimate for LMAT’s earnings has moved 4.5% north in the past 30 days. Shares of LeMaitre Vascular have risen 57.2% in the past year.
Tenet Healthcare’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 58.48%. The consensus estimate for THC’s 2024 earnings indicates an improvement of 53.3% from the year-ago figure. The consensus mark for revenues implies growth of 1.4% from the year-ago figure.
The Zacks Consensus Estimate for THC’s earnings has moved 20.6% north in the past 30 days. Shares of Tenet Healthcare have rallied 117.6% in the past year.