Chemed (CHE) AI Stock Analysis

• Market Cap: $6.69B
• Dividend Yield: 0.44%
• Average Volume (3M): 165.78K
• Price to Earnings (P/E): 22.3
• Beta (1Y): 0.15
• Revenue Growth: 8.52%
• EPS Growth: 10.36%
• Country: US
• Employees: 15,695
• Sector: Healthcare
• Sector Strength: 44
• Industry: Medical - Care Facilities
• EPS (TTM): 5.63
• Shares Outstanding: 14,629,484
• 10 Day Avg. Volume: 121,502
• 30 Day Avg. Volume: 165,776
• PEG Ratio: 7.14
• Price to Book (P/B): 5.65
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 21.22
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 0.69
• Enterprise Value/Gross Profit: 7.92
• Enterprise Value/Ebitda: 3.73
• 1Y Price Target: $646.67
• Price Target Upside: 41.36% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 66 Neutral
• Price Target: $526.00 ▲(14.98%Upside)

Chemed's overall stock score reflects strong financial performance with robust growth in key areas but is offset by technical weaknesses and recent negative corporate events. Despite high operational efficiency and strategic acquisitions boosting growth, the lowered earnings guidance and technical downturn present challenges.

Positive Factors

Financial Performance

Roto revenues came in much better and grew year over year, which is a welcome sign given the declines last year.

Market Demand

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

Pricing Strategy

Roto has the ability to push higher prices to consumers while most of its services are need-based, providing a potential advantage.

Negative Factors

Demand Imbalance

Commercial demand showed improvement but was not enough to offset weak residential demand.

Medicare Cap

The Medicare cap will be a $20m or 4% headwind in 2025, which was not a surprise given the Q1 disclosures.

Regional Performance

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

Chemed Business Overview & Revenue Model

Company Description

Chemed Corporation (CHE) is a diversified public company that operates through two primary subsidiaries: VITAS Healthcare and Roto-Rooter. VITAS Healthcare is a leading provider of end-of-life hospice care services in the United States, delivering a range of healthcare services to terminally ill patients and their families. Roto-Rooter is the largest provider of plumbing and drain cleaning services in North America, serving both residential and commercial customers with a variety of repair and maintenance solutions.

How the Company Makes Money

Chemed Corporation generates revenue through its two main business segments: VITAS Healthcare and Roto-Rooter. VITAS Healthcare earns money primarily from Medicare and Medicaid reimbursements, as well as private insurance and private pay sources, by providing hospice care services which include medical care, pain management, and emotional support to patients and families. Revenue is largely dependent on the number of patients served and the level of care provided. Roto-Rooter contributes to Chemed's revenue by offering plumbing repair and drain cleaning services to residential and commercial clients. Income is generated from service fees and sales of related products. The company benefits from its strong brand recognition and extensive service network, which includes a mix of company-owned and independent franchise locations. Significant factors that contribute to Chemed's earnings include demographic trends such as an aging population, regulatory changes in healthcare, and economic conditions affecting consumer spending on home maintenance services.

Chemed Financial Statement Overview

Summary

Chemed exhibits strong financial health characterized by consistent revenue growth, healthy profitability, and effective cash flow management. The company's low leverage and strong equity position provide financial stability, although careful monitoring of 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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.43B	2.26B	2.13B	2.14B	2.08B
Gross Profit	854.35M	796.55M	765.09M	769.80M	701.39M
EBITDA	464.29M	414.34M	393.44M	411.23M	454.93M
Net Income	302.00M	272.51M	249.62M	268.55M	319.47M
Balance Sheet
Total Assets	1.67B	1.67B	1.44B	1.34B	1.43B
Cash, Cash Equivalents and Short-Term Investments	178.35M	263.96M	74.13M	32.90M	162.68M
Total Debt	140.84M	155.11M	247.01M	323.54M	135.41M
Total Liabilities	549.58M	560.22M	643.30M	719.45M	533.71M
Stockholders Equity	1.12B	1.11B	798.72M	623.27M	901.20M
Cash Flow
Free Cash Flow	367.97M	273.44M	252.56M	249.92M	430.46M
Operating Cash Flow	417.50M	330.30M	309.89M	308.60M	489.29M
Investing Cash Flow	-143.91M	-60.64M	-59.40M	-57.76M	-61.56M
Financing Cash Flow	-359.19M	-79.83M	-209.25M	-380.62M	-271.21M

Chemed Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 457.46
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHE, the sentiment is Negative. The current price of 457.46 is below the 20-day moving average (MA) of 497.19, below the 50-day MA of 538.13, and below the 200-day MA of 560.72, indicating a bearish trend. The MACD of -26.35 indicates Positive momentum. The RSI at 27.36 is Positive, neither overbought nor oversold. The STOCH value of 15.77 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CHE.

Chemed Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OPCH	78 Outperform	$5.03B	24.27	15.38%	―	16.98%	-17.76%
AMED	71 Outperform	$3.20B	36.07	7.85%	―	5.34%	―
ENSG	69 Neutral	$8.12B	26.52	17.66%	0.18%	16.80%	39.99%
CHE	66 Neutral	$6.69B	22.28	26.11%	0.44%	8.52%	10.36%
EHC	65 Neutral	$10.81B	22.15	25.33%	0.62%	11.21%	30.38%
SEM	64 Neutral	$1.87B	10.99	10.38%	1.72%	-8.86%	-36.22%
Sector *	52 Neutral	$7.47B	-0.04	-63.86%	2.34%	16.17%	0.25%

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.

The most recent analyst rating on (CHE) stock is a Buy with a $708.00 price target. To see the full list of analyst forecasts on Chemed stock, see the CHE Stock Forecast page.

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.

The most recent analyst rating on (CHE) stock is a Buy with a $708.00 price target. To see the full list of analyst forecasts on Chemed stock, see the CHE Stock Forecast page.