Encompass Health price target raised to $140 from $135 at KeyBanc

KeyBanc raised the firm’s price target on Encompass Health (EHC) to $140 from $135 and keeps an Overweight rating on the shares. The firm recently spent time with Encompass Health’s management team at the company’s Birmingham headquarters and hosted a group call with investors. KeyBanc believes Encompass Health is well positioned to sustain attractive growth, given IRF supply-demand dynamics and visible market share opportunities. Upside drivers from the first half of the year seem sustainable to us, including the favorable mix of VA patients. Policy backdrop for IRFs remains benign. Leverage and free cash flow may support an accelerated pace of buybacks.