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The Ensign Group (ENSG)
NASDAQ:ENSG
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The Ensign Group
(NASDAQ:ENSG)
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Rating:78Outperform
Price Target:
$210.00
▲(14.42% Upside)
The Ensign Group's strong financial performance and positive earnings call sentiment are the most significant factors driving the high overall score. The company's robust revenue growth, strategic acquisitions, and clinical excellence contribute to its strong market position. While the technical analysis supports a stable outlook, the high P/E ratio suggests potential overvaluation, which slightly tempers the overall score.
Positive Factors
Revenue Growth
The Ensign Group's strong revenue growth indicates robust demand for its services and effective operational strategies, supporting long-term financial health.
Strategic Acquisitions
Strategic acquisitions expand The Ensign Group's market presence and capacity, enhancing its competitive position and growth potential.
Clinical Excellence
Clinical excellence and improved operational metrics strengthen The Ensign Group's reputation and ability to attract more residents, driving future growth.
Negative Factors
Challenging Deal Environment
A challenging deal environment can hinder The Ensign Group's ability to acquire assets at favorable prices, potentially impacting future growth and profitability.
Labor Market Challenges
Labor market challenges can increase operational costs and affect service quality, posing a risk to The Ensign Group's long-term operational efficiency.
Elevated Debt Levels
While manageable, elevated debt levels can limit financial flexibility and increase risk, especially if market conditions or interest rates change.
The Ensign Group (ENSG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.29B
Dividend Yield0.14%
Average Volume (3M)309.83K
Price to Earnings (P/E)31.6
Beta (1Y)0.28
Revenue Growth18.61%
EPS Growth35.76%
CountryUS
Employees39,300
SectorHealthcare
Sector Strength45
IndustryMedical - Care Facilities
Share Statistics
EPS (TTM)1.64
Shares Outstanding57,924,780
10 Day Avg. Volume232,483
30 Day Avg. Volume309,831
Financial Highlights & Ratios
PEG Ratio0.63
Price to Book (P/B)4.10
Price to Sales (P/S)1.77
P/FCF Ratio39.84
Enterprise Value/Market Cap1.15
Enterprise Value/Revenue2.45
Enterprise Value/Gross Profit15.66
Enterprise Value/Ebitda21.98
Forecast
1Y Price Target
$209.00Price Target Upside13.87% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)7.24
Revenue Forecast (FY)$5.70B
The Ensign Group Business Overview & Revenue Model
Company DescriptionThe Ensign Group, Inc. provides health care services in the post-acute care continuum and other ancillary businesses. The company operates in two segments, Skilled Services and Real Estate. The company offers skilled services, which include short and long-term nursing care services for patients with chronic conditions, prolonged illness, and the elderly; and physical, occupational, and speech therapies and other rehabilitative and healthcare services. It also provides standard services, such as room and board, special nutritional programs, social, recreational, entertainment, and other services. In addition, the company offers senior living, as well as mobile diagnostics services; leases real estate properties; and provides other ancillary services consisting of digital x-ray, ultrasound, electrocardiogram, laboratory, sub-acute, and patient transportation services to people in their homes or at long-term care facilities. As of April 4, 2022, it operated 252 healthcare facilities in Arizona, California, Colorado, Idaho, Iowa, Kansas, Nebraska, Nevada, South Carolina, Texas, Utah, Washington, and Wisconsin. The company was incorporated in 1999 and is based in San Juan Capistrano, California.
How the Company Makes MoneyThe Ensign Group generates revenue primarily through the provision of skilled nursing and assisted living services, billing government programs such as Medicare and Medicaid, as well as private pay sources. A significant portion of its revenue comes from reimbursements for healthcare services provided to patients in its facilities. Additionally, Ensign has expanded its revenue streams by acquiring and managing skilled nursing facilities, which allows it to benefit from economies of scale and operational efficiencies. Partnerships with healthcare networks and insurance providers also contribute to its earnings, enabling Ensign to secure contracts that ensure a steady flow of patients and revenue. The company's focus on quality care and operational excellence helps maintain high occupancy rates, further supporting its financial performance.
The Ensign Group Earnings Call Summary
Earnings Call Date:Nov 03, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 11, 2026
Earnings Call Sentiment Positive
The earnings call reflects a strong positive sentiment overall, with record-breaking performance metrics, significant revenue and earnings growth, strategic acquisitions, and clinical excellence. Challenges noted include fluctuating deal markets and labor issues, but they are outweighed by the positive outcomes and strategic growth initiatives.Q3-2025 Updates
Positive Updates
Record-Breaking Performance
Achieved another record quarter with increased occupancy rates reaching all-time highs of 83% and 84.4% in same-store and transitioning facilities respectively.
Significant Revenue and Earnings Growth
Increased 2025 earnings guidance to $6.48 to $6.54 per diluted share, representing an 18.4% increase over 2024 and a 36.5% increase over 2023. Revenue guidance also increased to $5.05 billion to $5.07 billion.
Expansion and Acquisition Success
Acquired 22 new operations during the quarter, including large portfolios in California and Utah, adding significant capacity with 1,857 new skilled nursing beds and 109 senior living units.
Strong Financial Health
Maintained a lease adjusted net debt-to-EBITDA ratio of 1.86x with over $1 billion in available liquidity for future investments.
Clinical Excellence and Market Share Growth
Improved skilled mix days by 5.1% and 10.9% for same-store and transitioning operations respectively, with Medicare revenue increasing by 10% and 8.8%.
Negative Updates
Challenging Deal Environment
Observed fluctuations in the deal market with some areas experiencing elevated pricing not supported by operational fundamentals, particularly in Texas.
Labor Market Challenges
While improvements are noted, there is still minimal use of contract labor in new acquisitions, indicating ongoing challenges in labor availability.
Company Guidance
During The Ensign Group's Q3 2025 earnings call, the company provided guidance indicating a strong financial outlook driven by robust operational performance and strategic acquisitions. They raised their 2025 earnings guidance to between $6.48 and $6.54 per diluted share, reflecting an 18.4% increase over 2024, and a 36.5% increase over 2023. Additionally, annual revenue guidance was increased to a range of $5.05 billion to $5.07 billion, up from the previous $4.99 billion to $5.02 billion. This upward revision is attributed to record-high occupancy rates of 83% and 84.4% in same-store and transitioning facilities, respectively, and significant growth in skilled mix days and Medicare revenue. The company highlighted demographic trends as a significant driver, with the U.S. population aged 80 and older expected to grow by over 50% by 2035. The Ensign Group also emphasized the importance of their clinically driven culture, noting a 24% to 33% outperformance in CMS survey results at the state and county levels. Despite fluctuating deal markets, they expressed confidence in continued organic growth and strategic acquisitions, having added 22 new operations during the quarter.The Ensign Group Financial Statement Overview
Summary
The Ensign Group exhibits strong financial health with consistent revenue and profit growth, efficient cost management, and a balanced capital structure. The company effectively generates cash, supporting its operational and strategic initiatives. While leverage is managed well, continued focus on maintaining margins and cash flow growth will be crucial for sustained performance.Income Statement
The Ensign Group has demonstrated consistent revenue growth with a TTM revenue growth rate of 4.65%, building on previous annual growth. Gross profit and net profit margins have remained stable, indicating strong operational efficiency. The EBIT and EBITDA margins are healthy, reflecting effective cost management and profitability.85
Very Positive
Balance Sheet
The company's debt-to-equity ratio has improved slightly to 1.01 in the TTM, indicating a balanced approach to leveraging. Return on equity is robust at 17.15%, showcasing effective use of equity to generate profits. The equity ratio is stable, reflecting a solid capital structure.78
Positive
Cash Flow
Operating cash flow and free cash flow have shown positive growth, with a TTM free cash flow growth rate of 4.61%. The operating cash flow to net income ratio is healthy, indicating strong cash generation relative to net income. The free cash flow to net income ratio is also solid, supporting the company's ability to reinvest and distribute cash.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.83B | 4.26B | 3.73B | 3.03B | 2.63B | 2.40B |
| Gross Profit | 756.03M | 667.59M | 590.76M | 517.99M | 468.21M | 407.47M |
| EBITDA | 538.71M | 478.52M | 353.24M | 360.38M | 320.84M | 281.54M |
| Net Income | 328.20M | 297.97M | 209.40M | 224.68M | 194.65M | 170.48M |
Balance Sheet | ||||||
| Total Assets | 5.23B | 4.67B | 4.18B | 3.45B | 2.85B | 2.55B |
| Cash, Cash Equivalents and Short-Term Investments | 506.31M | 526.85M | 526.86M | 331.71M | 275.96M | 250.01M |
| Total Debt | 2.16B | 1.97B | 1.87B | 1.57B | 1.27B | 1.11B |
| Total Liabilities | 3.10B | 2.83B | 2.68B | 2.20B | 1.83B | 1.73B |
| Stockholders Equity | 2.12B | 1.84B | 1.49B | 1.25B | 1.02B | 818.08M |
Cash Flow | ||||||
| Free Cash Flow | 289.53M | 188.95M | 270.49M | 184.97M | 206.13M | 323.02M |
| Operating Cash Flow | 481.41M | 347.19M | 376.67M | 272.51M | 275.68M | 373.35M |
| Investing Cash Flow | -555.82M | -390.05M | -182.70M | -186.18M | -173.91M | -58.67M |
| Financing Cash Flow | -13.98M | -2.16M | -612.00K | -32.26M | -76.14M | -137.30M |
The Ensign Group Technical Analysis
Positive
183.54
Price Trends
178.98
Positive
176.85
Positive
160.82
Positive
Market Momentum
0.14
Negative
61.69
Neutral
71.46
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ENSG, the sentiment is Positive. The current price of 183.54 is above the 20-day moving average (MA) of 177.36, above the 50-day MA of 178.98, and above the 200-day MA of 160.82, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 61.69 is Neutral, neither overbought nor oversold. The STOCH value of 71.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ENSG.
The Ensign Group Risk Analysis
The Ensign Group disclosed 51 risk factors in its most recent earnings report. The Ensign Group reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
The Ensign Group Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $10.29B | 31.60 | 16.98% | 0.14% | 18.61% | 35.76% | |
76 Outperform | $12.45B | 9.47 | 19.97% | 0.35% | 10.21% | 39.58% | |
74 Outperform | $2.10B | 20.88 | 9.94% | 1.80% | 23.74% | -18.99% | |
74 Outperform | $17.15B | 13.80 | 34.51% | ― | -0.56% | -53.50% | |
64 Neutral | $10.08B | 18.94 | 24.94% | 0.65% | 11.13% | 27.53% | |
53 Neutral | $1.99B | -11.80 | -9.45% | ― | 10.14% | -182.12% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
ENSG
The Ensign Group
183.54
46.92
34.35%
EHC
Encompass Health
102.80
8.66
9.20%
NHC
National Healthcare
139.01
42.10
43.44%
THC
Tenet Healthcare
201.32
70.46
53.84%
UHS
Universal Health
204.19
20.15
10.95%
SGRY
Surgery Partners
16.00
-4.19
-20.75%
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.