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Chemed Corp (CHE) Stock

Chemed Corp Stock Details, Movements and Public Alerts

Chemed Corp (CHE): The $6.1B Conglomerate Dominating Hospice Care and Plumbing Services

When Kevin McNamara became CEO of Chemed in 2001, the company was a struggling conglomerate with underperforming healthcare assets and a well-known plumbing brand (Roto-Rooter) acquired in 1980. Over 24 years, McNamara transformed CHE into the largest hospice care provider in America—VITAS Healthcare now serves 19,000+ patients daily across 15 states, generating $2B+ revenue—while maintaining Roto-Rooter as a recession-resistant plumbing services cash cow. The strategy is counterintuitive: most companies divest unrelated businesses, but McNamara leveraged hospice's predictable Medicare reimbursement (90%+ of VITAS revenue) to fund Roto-Rooter's national expansion. Today, CHE generates $2.5B revenue, 11% profit margins, and 24.1% ROE with ultra-low beta (0.465). At $447.55 (down 28% from highs), analysts see $578.50 upside (29%) as aging Baby Boomers drive hospice demand growth 8-10% annually through 2030. This is boring, profitable healthcare—perfect for defensive portfolios.

52-Week Range

$621.35 - $407.30

-30.39% from high · +6.19% from low

Avg Daily Volume

140,100

20-day average

100-day avg: 184,725

Fundamentals

Valuation Metrics

P/E Ratio (TTM)

22.73

Near market average

Forward P/E

16.95

Earnings expected to grow

PEG Ratio

1.70

Reasonably valued

Price to Book

5.62

EV/EBITDA

13.90

EPS (TTM)

$18.92

Price to Sales

2.48

Beta

0.46

Less volatile than market

Q:How is CHE valued relative to its earnings and growth?
Chemed Corp trades at a P/E ratio of 22.73, which is near the market average of approximately 20, suggesting the market views it as fairly valued relative to its earnings. Looking ahead, the forward P/E of 16.95 is lower than the current P/E, indicating analysts expect earnings to grow over the next year. The PEG ratio of 1.70 indicates reasonable value when growth is considered.
Q:What is CHE's risk profile compared to the market?
With a beta of 0.46, Chemed Corp is less volatile than the overall market. This means when the market moves up or down by 10%, this stock typically moves less than 10% in the same direction. Lower beta stocks are often preferred by conservative investors seeking stability. The price-to-book ratio of 5.62 shows investors value the company above its book value, which often reflects intangible assets or growth prospects.

Performance & Growth

Profit Margin

11.00%

Operating Margin

12.00%

EBITDA

$412.00M

Return on Equity

24.10%

Return on Assets

13.00%

Revenue Growth (YoY)

3.10%

Earnings Growth (YoY)

-10.80%

Q:How profitable and efficient is CHE's business model?
Chemed Corp achieves a profit margin of 11.00%, meaning it retains $11.00 from every $100 in revenue after all expenses. This represents a solid margin typical of well-run businesses, showing the company can effectively balance revenue generation with cost control. The operating margin of 12.00% reveals how efficiently the company runs its core business operations before interest and taxes. With ROE at 24.10% and ROA at 13.00%, the company generates strong returns on invested capital.
Q:What are CHE's recent growth trends?
Chemed Corp's revenue grew by 3.10% year-over-year, showing steady progress in growing the business. This positive trajectory indicates the company maintains competitive positioning in its markets. Earnings decreased by 10.80% year-over-year, reflecting the bottom-line impact of business performance. These growth metrics should be evaluated against MEDICAL CARE FACILITIES industry averages for proper context.

Dividend Information

Dividend Per Share

$2.10

Dividend Yield

0.49%

Ex-Dividend Date

Nov 17, 2025

Dividend Date

Dec 5, 2025

Q:What dividend income can investors expect from CHE?
Chemed Corp offers a dividend yield of 0.49%, paying $2.10 per share annually. This modest yield below 2% suggests the company prioritizes growth investments over current income. While the dividend provides some return, investors are likely attracted more by capital appreciation potential than income generation. To receive the next dividend, shares must be purchased before the ex-dividend date of Nov 17, 2025.
Q:How reliable is CHE's dividend for long-term investors?
The dividend sustainability can be assessed through the payout ratio - Chemed Corp pays $2.10 per share in dividends against earnings of $18.92 per share, resulting in a payout ratio of 11.10%. This conservative payout below 30% indicates excellent dividend safety with substantial room for future increases. The company retains most earnings for growth while still rewarding shareholders. The next dividend payment is scheduled for Dec 5, 2025.

Company Size & Market

Market Cap

$6.3B

Revenue (TTM)

$2.53B

Revenue/Share (TTM)

$173.17

Shares Outstanding

14.11M

Book Value/Share

$76.31

Asset Type

Common Stock

Q:What is CHE's market capitalization and position?
Chemed Corp has a market capitalization of $6.3B, classifying it as a mid-cap stock ($2B-$10B). Mid-caps often represent companies in their growth phase, offering higher growth potential than large-caps but with more stability than small-caps. They can be attractive takeover targets and may become tomorrow's large-caps. With 14.11M shares outstanding, the company's ownership is relatively concentrated. As a participant in the MEDICAL CARE FACILITIES industry, it competes with other firms in this sector.
Q:How does CHE's price compare to its book value?
Chemed Corp's book value per share is $76.31, while the current stock price is $432.51, resulting in a price-to-book (P/B) ratio of 5.67. This high P/B ratio indicates significant intangible assets, strong brand value, or high growth expectations. Technology and consumer brand companies often trade at elevated P/B ratios due to intellectual property and competitive advantages not reflected on the balance sheet. As a common stock, this represents equity ownership with voting rights.

Analyst Ratings

Analyst Target Price

$574.25

32.77% upside potential

Analyst Recommendations

Strong Buy

1

Buy

3

Hold

0

Sell

0

Strong Sell

0

Q:How reliable are analyst predictions for CHE?
4 analysts cover CHE with 100% recommending buy/strong buy ratings. Analyst predictions have mixed reliability - studies show consensus rarely beats market returns consistently. The strong bullish consensus may already be priced in. The consensus target of $574.25 implies 32.8% upside, but targets are often adjusted to follow price moves rather than predict them.
Q:What is the Wall Street consensus on CHE?
Current analyst recommendations:1 Strong Buy, 3 Buy, 000The bullish tilt suggests optimism about future prospects, though investors should conduct independent research.Remember that analyst opinions often lag price movements and can be influenced by investment banking relationships.

Fundamentals last updated: Dec 13, 2025, 08:19 AM

Technical Indicators

RSI (14-day)

44.84

Neutral

50-Day Moving Average

$435.93

-0.78% below MA-50

200-Day Moving Average

$501.11

-13.69% below MA-200

MACD Line

-4.71

MACD Signal

-3.21

MACD Histogram

-1.50

Bearish

Q:What does CHE's RSI value tell investors?
The RSI (Relative Strength Index) for CHE is currently 44.84, indicating the stock is in neutral territory (40-60 range). Neither buyers nor sellers have clear control, suggesting consolidation or balanced market forces. Combined with the price being below the 50-day moving average, this confirms bearish conditions.
Q:How should traders interpret CHE's MACD and moving average crossovers?
MACD analysis shows the MACD line at -4.71 below the signal line at -3.21, with histogram at -1.50. This bearish crossover indicates downward pressure. The wide histogram confirms strong momentum. The 50-day MA ($435.93) is below the 200-day MA ($501.11), forming a death cross pattern that often warns of extended weakness. Price is currently below both MAs, confirming weakness.

Indicators last updated: Dec 11, 2025, 12:35 AM

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Chemed Corp (CHE) Stock Analysis 2025: Complete Investment Guide

From Struggling Conglomerate to Hospice Powerhouse

Kevin McNamara's 2001 turnaround plan was radical but logical: exit non-core businesses (pet supply distribution, carpet cleaning), double down on VITAS Healthcare (acquired 1999), and treat Roto-Rooter as a defensive cash generator. The hospice bet paid off spectacularly—aging Baby Boomers (10,000 Americans turn 65 daily) created sustained 8-10% annual demand growth, Medicare reimbursement proved stable (90%+ of VITAS revenue), and regulatory barriers limited competition. By 2025, VITAS serves 19,000+ patients daily (vs. 8,000 in 2005), operates 50+ hospice programs across 15 states, and generates $2B+ revenue with 12-14% operating margins. Roto-Rooter complements perfectly: plumbing emergencies (clogged drains, sewer backups) occur regardless of economic conditions, brand recognition drives premium pricing, and franchise model enables low-capex expansion. Together, CHE generates $2.5B revenue, $412M EBITDA, and consistent 20%+ ROE.

Business Model: Hospice + Plumbing = Recession-Proof

  • •VITAS Healthcare (80% revenue): Hospice care for terminally ill patients (<6 months life expectancy); Medicare reimburses ~$200/day per patient; 90%+ revenue from Medicare/Medicaid (government-backed, predictable)
  • •Roto-Rooter (20% revenue): Plumbing, drain cleaning, water damage restoration; 80+ franchisees + company-owned locations; brand recognition enables 20-30% pricing premium vs. local plumbers
  • •Revenue Mix: VITAS generates $2B+ (growing 8-10%/year), Roto-Rooter $500M+ (growing 3-5%/year); combined operating margin 12%
  • •Competitive Moats: VITAS: regulatory licensing (barriers to entry), Medicare relationships, scale advantages. Roto-Rooter: 90+ year brand, national footprint, franchise model enables rapid expansion
  • •Recession Resistance: Hospice demand immune to economic cycles (demographic-driven); plumbing emergencies non-discretionary

Financial Performance: Boring Profitability

  • •Revenue: $2.53B TTM (+3.1% YoY); VITAS growth accelerating as Boomers age, Roto-Rooter steady 3-5%
  • •Profitability: 11% profit margin, 12% operating margin; $412M EBITDA, 24.1% ROE (excellent capital efficiency)
  • •Earnings: EPS $18.89, Trailing PE 22.78 (fair for quality), Forward PE 17.61 (attractive vs. healthcare peers)
  • •Cash Flow: Free cash flow $300M+ annually; supports dividends ($2.10/share, 0.49% yield) + share buybacks
  • •Balance Sheet: Net debt $1B (1.5x EBITDA), manageable; investment-grade credit rating enables low-cost financing

Growth Catalysts

  • •Aging Demographics: 10,000 Americans turn 65 daily through 2030; hospice utilization rate rising from 50% to 60%+ (TAM expansion $5B+)
  • •VITAS Expansion: Targeting 5-7 new hospice programs annually; each program generates $30-50M revenue at maturity
  • •Medicare Reimbursement Increases: Annual 2-3% CPI adjustments; potential hospice payment reform could add 5-10% reimbursement
  • •Roto-Rooter Geographic Expansion: Adding 10-15 franchise territories annually; targeting $1B revenue by 2028
  • •M&A Optionality: CHE generates $300M+ free cash flow; potential bolt-on hospice acquisitions (regional players) or adjacent services (home health, palliative care)

Risks & Challenges

  • •Medicare Reimbursement Cuts: Federal budget pressures could reduce hospice payments 5-10%; eliminates $100M+ EBITDA
  • •Regulatory Risk: Hospice industry faces heightened Medicare fraud scrutiny; compliance violations = fines, license suspensions
  • •Competition Intensifying: Private equity rolling up hospice providers (Compassus, Kindred); market share erosion possible
  • •Roto-Rooter Commoditization: Digital platforms (Angi, HomeAdvisor) reduce brand moat; pricing power eroding 2-3%/year
  • •Valuation Risk: Trading at 28% discount to highs but still PE 22.78; if earnings decline, stock could correct to $350-380 (22% downside)

Competitive Landscape

CompanyFocusRevenueMarket Cap
Chemed (CHE)Hospice + Plumbing$2.53B$6.1B
Encompass Health (EHC)Rehab hospitals$5.2B$7.8B
Amedisys (AMED)Home health + hospice$2.3B$3.5B (acquired)
LHC Group (acquired)Home health$2.4BAcquired by UHS
Gentiva (private)Hospice$1.8BPE-owned

VITAS competes in fragmented $25B+ hospice market where top 5 players control ~30% share. Amedisys (recently acquired by UnitedHealth) and LHC Group (acquired by UHS) validate hospice consolidation thesis—large healthcare systems acquiring scale players for vertical integration. CHE's $6.1B market cap makes it acquisition target for Humana, CVS Health, or UnitedHealth seeking Medicare Advantage hospice capabilities. Roto-Rooter faces competition from Angi, local plumbers, and franchise alternatives (Mr. Rooter, Benjamin Franklin), but 90+ year brand recognition and national footprint provide durable moat.

Who Is This Stock Suitable For?

Perfect For

  • ✓Defensive income + growth investors seeking recession-resistant healthcare exposure
  • ✓Baby Boomer demographic thematic investors with 5-7 year horizon
  • ✓Low-volatility portfolios (beta 0.465, consistent earnings)
  • ✓Contrarian value buyers accumulating quality stocks at 28% discount

Less Suitable For

  • ✗Growth-at-any-price investors (3-5% revenue growth is boring)
  • ✗High-yield income seekers (0.49% dividend yield too low)
  • ✗Short-term traders (low volume, slow-moving)
  • ✗ESG-focused investors uncomfortable with hospice/end-of-life exposure

Investment Thesis

Chemed Corp exemplifies boring, profitable healthcare at a reasonable price. Kevin McNamara's 24-year tenure has created two recession-resistant franchises: VITAS (largest U.S. hospice, growing 8-10%/year on aging demographics) and Roto-Rooter (national plumbing brand, steady 3-5% growth). At $447.55 (down 28% from highs), CHE trades at PE 17.61 (forward) with 24.1% ROE, 11% profit margins, and ultra-low beta (0.465). The investment case hinges on demographics: 10,000 Americans turn 65 daily through 2030, hospice utilization is rising from 50% to 60%+, and Medicare reimbursement remains stable. Analysts target $578.50 (29% upside), reflecting confidence in demographic tailwinds.

The bull case is straightforward: hospice demand accelerates 10%+ annually as Boomers age, VITAS adds 7-10 programs/year generating $300M+ incremental revenue, Roto-Rooter hits $1B revenue milestone, and CHE becomes acquisition target for UnitedHealth/CVS at $650-700/share (45-56% premium). At 17.61 forward PE with 8-10% organic growth, CHE is undervalued vs. 20-25x PE healthcare peers. The bear case is equally clear: Medicare cuts hospice reimbursement 10% (eliminates $200M EBITDA), regulatory scrutiny intensifies forcing compliance costs up 15-20%, and Roto-Rooter faces commoditization as Angi/HomeAdvisor erode pricing. At PE 22.78, stock corrects to $350-380 if earnings decline. At current levels, risk/reward skews positive for defensive portfolios seeking quality at reasonable prices.

Conclusion

CHE merits a BUY for defensive portfolios allocating 3-5% to low-volatility healthcare. The demographic tailwind (aging Boomers) is undeniable, VITAS's Medicare-backed revenue provides downside protection, and 24.1% ROE reflects capital efficiency. At 17.61 forward PE (vs. 20-25x peers), CHE is undervalued for quality. Best suited for investors seeking consistent 8-12% annual returns vs. high-risk growth. Not suitable for momentum traders or high-yield income seekers. Kevin McNamara's 24-year tenure demonstrates execution consistency. Accumulate on 5-10% dips below $420.
Bull Case
$675 (51% upside)
Base Case
$578 (29% upside)
Bear Case
$370 (17% downside)

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