Encompass Health Corp (EHC) is fairly valued and HCA Healthcare Inc (HCA) is undervalued.
Against our estimates of intrinsic value, HCA trades at the wider discount: a margin of safety of +35%, 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 8.7% (average of 3 methods) values the shares at $669.90; the price of $438.12 is 35% below that value, and 77% of that value comes from beyond year five.
Leak Score 100/100 on 7 of 12 signals
| Metric | EHC | HCA |
|---|---|---|
| Verdict | Fairly valued | Undervalued |
| Price | $122.76 | $438.12 |
| Intrinsic value | $126.92 | $669.90 |
| Margin of safety | +3% | +35% |
| Leak Score | 59/100 (3/12) | 100/100 (7/12) |
| Market cap | $12.1B | $94.9B |
| Revenue growth, 5 years | 5.0% | 8.0% |
| Operating margin | 18.0% | 15.5% |
| Net margin | 10.0% | 8.8% |
| Return on equity | 24.8% | — |
| Debt to equity | 1.09 | — |
| P/E | 20.0x | 14.7x |
| Forward P/E | 18.4x | 13.7x |
| P/B | 4.7x | — |
| Dividend yield | 0.5% | 0.6% |