TD Cowen initiated coverage of Encompass Health with a Buy rating and $125 price target. The firm says that in an under-supplied inpatient rehab industry, Encompass is "successfully executing a multipronged growth strategy" to fill demand while funding growth and buybacks with its cash flow. Raising leverage on the balance sheet "nominally" to 2.5-times and investing in further growth will drive annual EBITDA upside by 2030 versus the company's long-term algorithm, the analyst tells investors in a research note.
