Chemed (CHE) AI Stock Analysis

• Market Cap: $6.58B
• Dividend Yield: 0.46%
• Average Volume (3M): 179.08K
• Price to Earnings (P/E): 23.4
• Beta (1Y): 0.23
• Revenue Growth: 7.55%
• EPS Growth: -1.52%
• Country: US
• Employees: 15,695
• Sector: Healthcare
• Sector Strength: 46
• Industry: Medical - Care Facilities
• EPS (TTM): 4.27
• Shares Outstanding: 14,571,695
• 10 Day Avg. Volume: 158,179
• 30 Day Avg. Volume: 179,082
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.07
• Enterprise Value/Revenue: 2.81
• Enterprise Value/Gross Profit: 8.68
• Enterprise Value/Ebitda: 16.83
• 1Y Price Target: $559.80
• Price Target Upside: 22.24% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 66 Neutral
• Price Target: $480.00 ▲(4.81% Upside)

Chemed's overall stock score reflects a strong financial foundation but is tempered by technical weakness and mixed earnings guidance. The company's robust financial performance is a key strength, but recent challenges and a bearish technical outlook weigh on the score.

Positive Factors

Business Performance

Roto-Rooter is a resilient, cash-generative business with steady mid single-digit percentage growth, underpinned by its essential, emergency plumbing services and strong brand recognition.

Market Demand

Google searches for 'plumbing' in Q1 2025 jumped 16% quarter-over-quarter, indicating strong demand for Roto-Rooter services.

Strategic Initiatives

CHE's balance sheet is strong, providing flexibility to pursue strategic M&A and share repurchases, with a solid track record in capital deployment.

Negative Factors

Market Constraints

A recent increase in reimbursements, specifically in FL, is causing providers in that state to bump up against the national payment cap that Medicare has set, creating a temporary headwind for providers there.

Regional Performance

Admissions in Florida were weaker in April-May, and Roto residential was worse than expected.

Regulatory Challenges

The impact of recent issues related to the Medicare cap will likely carry over into '26 and limit the company's ability to achieve the Street's current EBITDA growth expectations.

Chemed Business Overview & Revenue Model

Company Description

Chemed Corporation (CHE) is a leading provider of hospice and palliative care services in the United States, primarily through its subsidiaries, VITAS Healthcare and Chemed's plumbing and drain cleaning services. The company operates in two main segments: VITAS, which offers comprehensive end-of-life care services to patients in their homes, nursing homes, and assisted living facilities, and Roto-Rooter, which provides plumbing and drain cleaning services. Chemed is committed to delivering high-quality, compassionate care, ensuring that patients and their families receive the support they need during critical times.

How the Company Makes Money

Chemed generates revenue primarily through its VITAS Healthcare segment, which earns money by providing hospice services reimbursed by Medicare, Medicaid, and private insurers. The company receives payment based on a per diem rate for each patient, which varies according to the level of care required. In addition to hospice care, Chemed's Roto-Rooter segment contributes to revenue through plumbing and drain cleaning services, charging customers on a fee-for-service basis. Significant partnerships with healthcare providers and participation in healthcare reimbursement programs further enhance Chemed's revenue streams, enabling it to maintain a steady influx of patients and contracts.

Chemed Financial Statement Overview

Summary

Chemed demonstrates strong financial health with consistent revenue growth, healthy profitability, and effective cash flow management. The low leverage and strong equity position provide financial stability, though monitoring cash reserves and debt levels is advisable.

Income Statement

Chemed's income statement shows a strong financial performance with consistent revenue growth, achieving a 3% increase in the latest TTM (Trailing-Twelve-Months) compared to the previous year. The company maintains healthy profit margins, with a TTM gross profit margin of 51.5% and a net profit margin of 12.4%. EBIT and EBITDA margins have remained stable, indicating effective cost management. However, the net profit margin shows a slight decrease from the previous year's 12.4%, suggesting some margin pressure.

Balance Sheet

The balance sheet reveals a solid financial position with a low debt-to-equity ratio of 0.12, indicating conservative leverage. The equity ratio is robust at 68.5%, reflecting strong shareholder equity relative to total assets. Return on equity is substantial at 26.1%, highlighting efficient use of equity. However, the decrease in cash and short-term investments and a slight increase in debt over the years may pose potential risks if not managed carefully.

Cash Flow

Chemed demonstrates strong cash flow management with a healthy operating cash flow to net income ratio of 1.18, indicating effective conversion of profits into cash. The free cash flow to net income ratio is robust at 1.02, reflecting solid free cash flow generation. While the free cash flow growth rate has seen some fluctuations, overall cash flow stability supports the company's financial flexibility and ability to invest in growth opportunities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.51B	2.43B	2.26B	2.13B	2.14B	2.08B
Gross Profit	812.94M	854.35M	796.55M	765.09M	769.80M	701.39M
EBITDA	419.29M	464.29M	414.34M	393.44M	411.23M	454.93M
Net Income	290.35M	302.00M	272.51M	249.62M	268.55M	319.47M
Balance Sheet
Total Assets	1.72B	1.67B	1.67B	1.44B	1.34B	1.43B
Cash, Cash Equivalents and Short-Term Investments	249.90M	178.35M	263.96M	74.13M	32.90M	162.68M
Total Debt	145.56M	140.84M	155.11M	247.01M	323.54M	135.41M
Total Liabilities	519.36M	549.58M	560.22M	643.30M	719.45M	533.71M
Stockholders Equity	1.20B	1.12B	1.11B	798.72M	623.27M	901.20M
Cash Flow
Free Cash Flow	371.39M	367.97M	273.44M	252.56M	249.92M	430.46M
Operating Cash Flow	426.78M	417.50M	330.30M	309.89M	308.60M	489.29M
Investing Cash Flow	-60.19M	-143.91M	-60.64M	-59.40M	-57.76M	-61.56M
Financing Cash Flow	-339.59M	-359.19M	-79.83M	-209.25M	-380.62M	-271.21M

Chemed Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 457.95
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHE, the sentiment is Neutral. The current price of 457.95 is above the 20-day moving average (MA) of 444.85, below the 50-day MA of 464.12, and below the 200-day MA of 539.10, indicating a neutral trend. The MACD of -1.29 indicates Negative momentum. The RSI at 53.07 is Neutral, neither overbought nor oversold. The STOCH value of 54.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CHE.

Chemed Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ENSG	76 Outperform	$9.91B	31.16	17.57%	0.14%	17.71%	41.83%
EHC	73 Outperform	$12.28B	23.84	25.35%	0.56%	11.80%	30.02%
AMED	73 Outperform		―	7.26%	―	4.92%	-7.34%
SEM	71 Outperform	$1.61B	12.22	8.15%	1.96%	-16.10%	-48.97%
OPCH	69 Neutral	$4.53B	22.78	15.25%	―	17.06%	5.03%
CHE	66 Neutral	$6.58B	23.41	24.14%	0.46%	7.55%	-1.52%
Sector *	51 Neutral	$7.85B	-0.18	-40.01%	2.28%	22.97%	-2.05%

Chemed Corporate Events

Chemed Lowers Earnings Guidance for 2025

On June 27, 2025, Chemed Corporation announced that it expects lower earnings for the second quarter and has reduced its full-year guidance for 2025. This announcement may impact the company’s operations and industry positioning, potentially affecting stakeholders’ expectations and market confidence.

Chemed Holds Annual Stockholders Meeting on Key Decisions

On May 19, 2025, Chemed Corporation held its annual meeting of stockholders where several key decisions were made. The entire Board of Directors was elected, the 2025 Stock Incentive Plan was approved, and PricewaterhouseCoopers LLP was ratified as the company’s independent accountants for the year ending December 31, 2024. Additionally, the executive compensation program was approved on a non-binding basis. A proposal to reduce the stockholder threshold for calling a special meeting was not presented due to the absence of the proponent or a representative.