Encompass Health Corp (EHC) is fairly valued and Fresenius Medical Care AG ADR (FMS) is undervalued.
Against our estimates of intrinsic value, FMS trades at the wider discount: a margin of safety of +48%, against +3% for EHC.
Values as of the 22 Sept 2026 close.
Discounting its cash flows at 8.3% (average of 3 methods) values the shares at $126.92; the price of $122.76 is 3% below that value, and 78% of that value comes from beyond year five.
Leak Score 59/100 on 3 of 12 signals
Discounting its cash flows at 7.1% (average of 3 methods) values the shares at $42.92; the price of $22.50 is 48% below that value, and 83% of that value comes from beyond year five.
Leak Score 54/100 on 3 of 12 signals
| Metric | EHC | FMS |
|---|---|---|
| Verdict | Fairly valued | Undervalued |
| Price | $122.76 | $22.50 |
| Intrinsic value | $126.92 | $42.92 |
| Margin of safety | +3% | +48% |
| Leak Score | 59/100 (3/12) | 54/100 (3/12) |
| Market cap | $12.1B | $12.0B |
| Revenue growth, 5 years | 5.0% | 1.7% |
| Operating margin | 18.0% | 10.9% |
| Net margin | 10.0% | 4.8% |
| Return on equity | 24.8% | 7.3% |
| Debt to equity | 1.09 | 0.87 |
| P/E | 20.0x | 11.6x |
| Forward P/E | 18.4x | 9.2x |
| P/B | 4.7x | 0.8x |
| Dividend yield | 0.5% | 3.7% |