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1. Company Snapshot

1.a. 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 segments, VITAS and Roto-Rooter.It offers plumbing, drain cleaning, excavation, water restoration, and other related services to residential and commercial customers through company-owned branches, independent contractors, and franchisees.


The company was incorporated in 1970 and is headquartered in Cincinnati, Ohio.

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1.b. Last Insights on CHE

Breaking News: Chemed Corporation reported its Q1 2026 earnings on April 24. The company's earnings call transcript revealed a thorough review of its financial performance. Cwm LLC increased its holdings in Chemed Corporation by 88.2% in Q4, owning 4,084 shares. Abacus FCF Advisors LLC also acquired a new position, buying 13,871 shares valued at approximately $5,935,000. Analysts at various firms have issued recommendations, with some suggesting a buy, while others advise to hold. A few have given a sell recommendation.

1.c. Company Highlights

2. Chemed’s VITAS Surge Drives Strong Q1, Roto-Rooter Mixed Signals

Chemed Corporation posted a robust first‑quarter 2026 earnings report, with VITAS healthcare leading the charge: net revenue rose 3.1% to $420 million, and adjusted EBITDA climbed to $70.8 million, a 0.6% increase, yielding a 16.8% margin. Q1 EPS excluding non‑cash items hit $5.65 versus the consensus estimate of $5.30, a 6.7% upside, underscoring the company’s operational discipline [1]. The firm’s valuation sits at a P/E of 22.17 and an EV/EBITDA of 14.2, indicating a premium for the strong growth trajectory.

Publication Date: Apr -26

📋 Highlights
  • VITAS Revenue Growth:: Net revenue reached $420M (+3.1% YoY), driven by 2.2% more days of care and 2.6% higher Medicare reimbursement rates.
  • Roto-Rooter EBITDA Decline:: Adjusted EBITDA fell 9.6% YoY to $53.5M due to 1.9% commercial revenue drop from weather events and higher marketing costs.
  • VITAS Guidance Raised:: 2026 ADC growth projected at 4.5-5.5% (up from prior) and revenue growth at 6.5-7.5%, with EBITDA margin target of 18-18.5%.
  • Acquisition Impact:: Two Roto-Rooter franchises acquired for $20.6M, expected to add $5M–$5.5M in 2026 revenue and $1M quarterly marketing cost adjustments.
  • Lead Mix Challenges:: Roto-Rooter’s paid lead share rose to 53–54%, but March visibility declined; 18% paid search growth offsets costly organic lead drop from 55% to 47%.

VITAS Revenue & EBITDA

VITAS’s 6.9% jump in admissions to 19,394, paired with a 2.2% rise in days of care and a 2.6% lift in Medicare rates, powered the 3.1% revenue growth. Adjusted EBITDA margin improved modestly to 16.8% from 16.2% the prior year, reflecting disciplined cost management amid a higher Medicare cap environment.

Roto-Rooter Segment Performance

Roto‑Rooter’s residential plumbing saw a 3.3% lift in leads and an 18.7% jump in paid leads, supporting a $53.5 million adjusted EBITDA, though this marks a 9.6% decline YoY. The commercial side suffered a 1.9% revenue dip due to weather‑related outages, tempering the segment’s 22.5% margin and highlighting seasonal volatility.

Guidance & Forecast Adjustments

Chemed lifted 2026 guidance, projecting VITAS ADC growth of 4.5%–5.5% and revenue growth of 6.5%–7.5% (ex‑MedCap), with a revised EBITDA margin of 18%–18.5%. Roto‑Rooter’s revenue growth remains at 3%–3.5%, with an EBITDA margin target of 21.5%–22.5%. Full‑year diluted EPS is now forecast at $20–$24.75, up 13% YoY.

Acquisitions & Marketing Spend

The company closed two franchises in San Francisco and Fort Worth for $20.6 million, expected to contribute $5–$5.5 million in revenue for the rest of 2026. Marketing costs exceeded budget by $2 million, largely weather‑driven, with $1 million earmarked as non‑run‑rate. An additional $1 million per quarter in marketing will be factored into EBITDA margin guidance for the next three quarters.

Collection Rate & Operational Outlook

Collection rates improved in Q1, with an anticipated $4–$6 million uplift for the year. Contract operations trailed expectations slightly, while water restoration revenue fell short of price or cost benchmarks, signaling a need for tighter pricing discipline.

Competitive Position & SEO Efforts

Roto‑Rooter’s paid‑lead mix remains near 53%–54%, with no major deterioration anticipated. The firm’s partnership with Google and a new SEO partner has boosted map visibility, though a March dip was noted. The 18% rise in paid search leads demonstrates adaptability, and the company is poised to navigate the transition cost while maintaining a dominant online presence.

3. NewsRoom

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CHE Stock Up Following Q1 Earnings & Revenue Beat, Margins Down

Apr -27

Source: zacks.com

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Chemed (NYSE:CHE) & LifeStance Health Group (NASDAQ:LFST) Financial Comparison

Apr -27

Source: defenseworld.net

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Chemed Corporation $CHE Shares Bought by Cwm LLC

Apr -26

Source: defenseworld.net

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Abacus FCF Advisors LLC Acquires New Holdings in Chemed Corporation $CHE

Apr -26

Source: defenseworld.net

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Chemed Corporation (CHE) Q1 2026 Earnings Call Transcript

Apr -24

Source: seekingalpha.com

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Chemed (CHE) Beats Q1 Earnings and Revenue Estimates

Apr -23

Source: zacks.com

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Chemed Reports First-Quarter 2026 Results

Apr -23

Source: globenewswire.com

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Evergreen Capital Management LLC Trims Position in Chemed Corporation $CHE

Apr -22

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.89%)

6. Segments

VITAS

Expected Growth: 8.37%

VITAS' 8.37% growth is driven by increasing demand for hospice care services, expansion into new markets, and strategic acquisitions. Additionally, the company's focus on providing high-quality patient care and improving operational efficiencies have contributed to its growth. Furthermore, the aging population and the shift towards value-based care have created a favorable environment for VITAS' services.

Roto-Rooter

Expected Growth: 4.83%

Roto-Rooter's 4.83% growth is driven by increasing demand for residential and commercial plumbing services, expansion into new markets, and strategic acquisitions. Additionally, the company's focus on water conservation and eco-friendly solutions resonates with environmentally conscious consumers, contributing to its growth momentum.

7. Detailed Products

VITAS Healthcare

VITAS Healthcare is a hospice care provider that offers end-of-life care to patients with terminal illnesses.

Roto-Rooter Plumbing and Water Cleanup

Roto-Rooter is a plumbing and water cleanup service provider that offers emergency plumbing, drain cleaning, and water damage restoration services.

8. Chemed Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Chemed Corporation's threat of substitutes is moderate due to the presence of alternative healthcare services and products. However, the company's diversified business model and strong brand recognition mitigate this threat.

Bargaining Power Of Customers

Chemed Corporation's customers have limited bargaining power due to the company's strong market position and diversified customer base. This reduces the risk of customers negotiating lower prices or demanding better services.

Bargaining Power Of Suppliers

Chemed Corporation's suppliers have moderate bargaining power due to the company's dependence on a few key suppliers. However, the company's strong relationships with suppliers and its diversified supply chain mitigate this risk.

Threat Of New Entrants

The threat of new entrants in Chemed Corporation's industry is low due to the high barriers to entry, including regulatory hurdles and significant capital requirements. This reduces the risk of new competitors entering the market.

Intensity Of Rivalry

The intensity of rivalry in Chemed Corporation's industry is high due to the presence of established competitors and the need to maintain market share. The company must continue to innovate and differentiate its services to remain competitive.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 12.28%
Debt Cost 3.95%
Equity Weight 87.72%
Equity Cost 6.23%
WACC 5.95%
Leverage 14.00%

11. Quality Control: Chemed Corporation passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Encompass Health

A-Score: 6.1/10

Value: 6.0

Growth: 5.1

Quality: 7.0

Yield: 2.0

Momentum: 8.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Ensign Group

A-Score: 5.5/10

Value: 2.6

Growth: 7.4

Quality: 4.7

Yield: 0.0

Momentum: 9.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
Option Care Health

A-Score: 5.4/10

Value: 4.0

Growth: 7.2

Quality: 6.8

Yield: 0.0

Momentum: 8.0

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
DaVita

A-Score: 4.8/10

Value: 8.0

Growth: 7.0

Quality: 4.7

Yield: 0.0

Momentum: 2.0

Volatility: 7.0

1-Year Total Return ->

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Stock-Card
Chemed

A-Score: 4.5/10

Value: 3.5

Growth: 6.0

Quality: 7.3

Yield: 0.0

Momentum: 2.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Select Medical

A-Score: 4.4/10

Value: 7.7

Growth: 4.3

Quality: 4.0

Yield: 4.0

Momentum: 1.0

Volatility: 5.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

423.94$

Current Price

423.94$

Potential

-0.00%

Expected Cash-Flows