Chemed Corporation (CHE)
NYSE:CHE
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Chemed
(NYSE:CHE)
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Rating:75Outperform
Price Target:
$474.00
▲(23.24% Upside)
Action:ReiteratedDate:04/25/26
Score driven primarily by strong financial performance (profitability, accelerating revenue, and robust free cash flow). The earnings call was supportive due to raised FY2026 guidance led by VITAS, partially offset by Roto-Rooter margin headwinds. Technical signals are mixed (negative MACD and below the 200-day), and valuation is reasonable but held back by a low dividend yield.
Positive Factors
Strong cash generation
Sustained high operating and free cash flow relative to earnings provides durable funding for capex, acquisitions, buybacks and dividends. Strong cash conversion (OCF above operating profit) gives flexibility to invest in VITAS growth and Roto-Rooter stabilization without relying on external financing.
Negative Factors
Roto-Rooter margin headwinds
Higher marketing-driven lead acquisition costs and disrupted water restoration pricing exert pressure on sustainable margins in a service business with thin operational leverage. Persistent elevated marketing and pricing mix issues can structurally reduce Roto‑Rooter profitability absent sustained volume or pricing improvements.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Sustained high operating and free cash flow relative to earnings provides durable funding for capex, acquisitions, buybacks and dividends. Strong cash conversion (OCF above operating profit) gives flexibility to invest in VITAS growth and Roto-Rooter stabilization without relying on external financing.
Read all positive factors
Chemed (CHE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.63B
Dividend Yield0.51%
Average Volume (3M)251.89K
Price to Earnings (P/E)19.5
Beta (1Y)0.30
Revenue Growth2.07%
EPS Growth-11.26%
CountryUS
Employees15,695
SectorHealthcare
Sector Strength45
IndustryMedical - Care Facilities
Share Statistics
EPS (TTM)5.65
Shares Outstanding13,413,917
10 Day Avg. Volume205,748
30 Day Avg. Volume251,889
Financial Highlights & Ratios
PEG Ratio-2.78
Price to Book (P/B)6.29
Price to Sales (P/S)2.43
P/FCF Ratio18.93
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue2.32
Enterprise Value/Gross Profit7.67
Enterprise Value/Ebitda14.29
Forecast
1Y Price Target
$446.50Price Target Upside16.09% Upside
Rating ConsensusHold
Number of Analyst Covering4
EPS Forecast (FY)23.88
Revenue Forecast (FY)$2.67B
Chemed Business Overview & Revenue Model
Company Description
Chemed Corporation provides hospice and palliative care services to patients through a network of physicians, registered nurses, home health aides, social workers, clergy, and volunteers primarily in the United States. The company operates in two ...
How the Company Makes Money
Chemed makes money through service revenue earned by its two operating segments: (1) VITAS Healthcare (hospice services) and (2) Roto-Rooter (plumbing and drain services).\n\nVITAS Healthcare revenue model: VITAS is paid for providing hospice and ...
Chemed Earnings Call Summary
Earnings Call Date:Apr 28, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 29, 2026
Earnings Call Sentiment Positive
The call presented strong performance and outlook improvements driven primarily by VITAS — higher admissions, modest revenue and margin gains, a sizable addition to Florida cap cushion, and upward revisions to full-year ADC, revenue growth and adjusted EBITDA margin. Roto-Rooter showed early signs of stabilization in core residential services and strategic franchise acquisitions, but faces near-term headwinds: elevated paid marketing costs, weather-related lost revenue, water restoration pricing disruptions and a notable YoY decline in Roto-Rooter EBITDA and margins. On balance, VITAS’ outperformance and the company’s raised guidance outweigh Roto-Rooter’s challenges, producing a constructive overall view for the year while acknowledging execution risks at Roto-Rooter.Positive Updates
VITAS Admissions and ADC Growth
Admissions totaled 19,394 in Q1 2026, a 6.9% increase year-over-year. Average daily census (ADC) was 22,723, up 2.2% year-over-year, and full-year ADC growth guidance was raised to 4.5%–5.5% (from 3.5%–4%).
Negative Updates
Roto-Rooter Revenue and EBITDA Pressure
Roto-Rooter branch commercial revenue declined 1.9% YoY to $56.5 million and branch residential revenue declined 1.5% YoY to $16.3 million. Adjusted EBITDA for Roto-Rooter fell to $53.5 million, down 9.6% YoY, and adjusted EBITDA margin declined by 218 basis points to 22.5%.
Read all updates
Q1-2026 Updates
Positive
Negative
VITAS Admissions and ADC Growth
Admissions totaled 19,394 in Q1 2026, a 6.9% increase year-over-year. Average daily census (ADC) was 22,723, up 2.2% year-over-year, and full-year ADC growth guidance was raised to 4.5%–5.5% (from 3.5%–4%).
Read all positive updates
Company Guidance
Chemed updated its fiscal 2026 guidance after a stronger‑than‑expected Q1 at VITAS: full‑year ADC growth was raised to 4.5%–5.5% (from 3.5%–4%), revenue growth excluding the Medicare Cap was increased to 6.5%–7.5% (from 5.5%–6.5%), and consolidated adjusted EBITDA margin excluding the Medicare Cap is now expected at 18.0%–18.5% (vs. prior 17.5%–18.5%); Roto‑Rooter revenue growth guidance remains 3.0%–3.5% but its estimated adjusted EBITDA margin was trimmed to 21.5%–22.5% (from 22.5%–23%) primarily due to elevated marketing spend. Management projects adjusted diluted EPS of $20.00–$24.75 for 2026 (originally $23.25–$24.25)—a midpoint the company stated is a 13% increase versus 2025 adjusted EPS of $21.55—and the guidance assumes a 24.5% effective tax rate on adjusted earnings and a diluted share count of 13.6 million shares.Chemed Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
78
Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.54B | 2.53B | 2.43B | 2.26B | 2.13B | 2.14B |
| Gross Profit | 770.25M | 758.34M | 854.35M | 798.82M | 765.09M | 769.80M |
| EBITDA | 413.34M | 422.37M | 464.29M | 414.34M | 393.44M | 411.23M |
| Net Income | 259.78M | 265.24M | 302.00M | 272.51M | 249.62M | 268.55M |
Balance Sheet | ||||||
| Total Assets | 1.54B | 1.64B | 1.67B | 1.67B | 1.44B | 1.34B |
| Cash, Cash Equivalents and Short-Term Investments | 16.86M | 74.52M | 178.35M | 263.96M | 74.13M | 32.90M |
| Total Debt | 236.93M | 154.76M | 140.84M | 155.11M | 247.01M | 323.54M |
| Total Liabilities | 687.82M | 660.61M | 549.58M | 560.22M | 643.30M | 719.45M |
| Stockholders Equity | 847.99M | 979.40M | 1.12B | 1.11B | 798.72M | 623.27M |
Cash Flow | ||||||
| Free Cash Flow | 377.12M | 325.48M | 367.97M | 273.44M | 252.56M | 249.92M |
| Operating Cash Flow | 443.75M | 388.27M | 417.50M | 330.30M | 309.89M | 308.60M |
| Investing Cash Flow | -83.45M | -59.34M | -143.91M | -60.64M | -59.40M | -57.76M |
| Financing Cash Flow | -517.32M | -432.77M | -359.19M | -79.83M | -209.25M | -380.62M |
Chemed Technical Analysis
Neutral
384.61
Price Trends
411.20
Negative
423.54
Negative
434.68
Negative
Market Momentum
-5.91
Negative
45.41
Neutral
36.17
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 384.61 is above the 20-day moving average (MA) of 380.31, below the 50-day MA of 411.20, and below the 200-day MA of 434.68, indicating a neutral trend. The MACD of -5.91 indicates Negative momentum. The RSI at 45.41 is Neutral, neither overbought nor oversold. The STOCH value of 36.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CHE.
Chemed Risk Analysis
Chemed disclosed 26 risk factors in its most recent earnings report. Chemed reported the most risks in the "Ability to Sell" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Chemed Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $2.73B | 17.67 | 11.57% | 1.80% | 17.53% | 17.13% | |
75 Outperform | $5.63B | 19.48 | 25.33% | 0.51% | 2.07% | -11.26% | |
75 Outperform | $1.81B | 20.66 | 9.24% | ― | 23.21% | 22.48% | |
74 Outperform | $10.89B | 29.02 | 16.58% | 0.14% | 19.48% | 13.66% | |
67 Neutral | $4.22B | 24.29 | 15.39% | ― | 13.03% | 3.75% | |
63 Neutral | $10.15B | 10.44 | -160.63% | ― | 6.46% | -11.49% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
CHE
Chemed
423.94
-147.00
-25.75%
ADUS
Addus Homecare
96.96
-6.96
-6.70%
OPCH
Option Care Health
26.87
-5.30
-16.47%
DVA
DaVita
151.99
11.55
8.22%
NHC
National Healthcare
175.07
82.55
89.22%
ENSG
The Ensign Group
186.40
58.48
45.71%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.