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EHC vs JNJ

EHC
Encompass Health Corporation
BULLISH
Price
$101.98
Market Cap
$10.14B
Sector
Healthcare
AI Confidence
85%
JNJ
Johnson & Johnson
NEUTRAL
Price
$237.96
Market Cap
$573.46B
Sector
Healthcare
AI Confidence
85%

Valuation

P/E Ratio
EHC
18.37
JNJ
21.55
Forward P/E
EHC
15.74
JNJ
18.9
P/B Ratio
EHC
4.18
JNJ
7.03
P/S Ratio
EHC
1.71
JNJ
6.09
EV/EBITDA
EHC
9.86
JNJ
17.81

Profitability

Gross Margin
EHC
43.21%
JNJ
68.08%
Operating Margin
EHC
18.35%
JNJ
23.97%
Profit Margin
EHC
9.54%
JNJ
28.46%
ROE
EHC
24.82%
JNJ
35.03%
ROA
EHC
9.66%
JNJ
8.68%

Growth

Revenue Growth
EHC
9.9%
JNJ
9.1%
Earnings Growth
EHC
21.2%
JNJ
48.6%

Financial Health

Debt/Equity
EHC
0.83
JNJ
0.6
Current Ratio
EHC
1.08
JNJ
1.03
Quick Ratio
EHC
0.83
JNJ
0.69

Dividends

Dividend Yield
EHC
0.75%
JNJ
2.19%
Payout Ratio
EHC
12.97%
JNJ
46.6%

AI Verdict

EHC BULLISH

EHC presents a stable financial profile with a Piotroski F-Score of 4/9 and a significant valuation gap between its defensive Graham Number ($55.18) and growth-based Intrinsic Value ($163.72). The company exhibits exceptional operational efficiency with an ROE of 24.82% and a highly attractive PEG ratio of 0.41, suggesting the stock is undervalued relative to its earnings growth. While insider sentiment is bearish and technical trends are currently weak, the long-term fundamental trajectory is supported by a 25-quarter track record of consistent earnings beats. The current price of $101.98 represents a reasonable entry point given the analyst target of $142.73.

Strengths
Exceptional earnings track record with consistent beats over 25 quarters
Very low PEG ratio (0.41) indicating strong growth at a reasonable price
High Return on Equity (24.82%) demonstrating efficient capital use
Risks
Bearish insider activity with significant selling by the CEO and other officers
Weak technical trend (0/100) indicating short-term price momentum is negative
Tight liquidity with a current ratio of 1.08
JNJ NEUTRAL

JNJ presents a dichotomy between strong profitability and deteriorating fundamental health, evidenced by a weak Piotroski F-Score of 3/9. While the company maintains an impressive ROE of 35.03% and a consistent history of earnings beats, the current price of $237.96 trades at a significant premium to its Graham Number of $91.72. Growth remains robust on a YoY basis, but bearish insider sentiment and a very weak technical trend (10/100) suggest immediate headwinds. The stock is fundamentally sound in terms of earnings power but shows signs of operational inefficiency or declining quality in its deterministic health metrics.

Strengths
Exceptional Return on Equity (ROE) of 35.03%
Strong profit margins (28.46%) and gross margins (68.08%)
Consistent earnings beat track record over 25 quarters
Risks
Weak Piotroski F-Score (3/9) indicating declining fundamental health
Bearish insider activity with $58.35M in net sales and zero buys
Low liquidity indicated by a Quick Ratio of 0.69

Compare Another Pair

EHC vs JNJ: Head-to-Head Comparison

This page compares Encompass Health Corporation (EHC) and Johnson & Johnson (JNJ) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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