Chemed Stock Earnings Reports

Chemed reported a strong Q1 2026 driven by an outperformance at VITAS and early signs of stabilization at Roto-Rooter. Key highlights: VITAS admissions rose 6.9% year-over-year to 19,394; average daily census increased 2.2% to 22,723; VITAS added over $32.5 million to the Florida cap cushion and management says the 2025 Florida cap issue is behind them. VITAS revenue was $420 million (up 3.1%) and adjusted EBITDA (ex-cap) was $70.8 million with a 16.8% margin (ex-cap). Management plans to hire more clinical FTEs (increasing hiring cadence to ~60/month) to sustain ADC growth. Roto-Rooter showed early improvements in core residential plumbing and sewer/drain services: total leads up 3.3% and paid leads up 18.7%, but higher paid-search marketing drove elevated marketing spend (~$3M in Q1 vs. prior year) and pressured adjusted EBITDA (Roto adjusted EBITDA down 9.6% to $53.5M; margin 22.5%). The company acquired two franchise territories (San Francisco and Fort Worth) for ~$20.6M, expected to add $5.0–$5.5M revenue for the remainder of 2026 and be immediately accretive. Management flagged one-time weather-related lost revenue for Roto-Rooter (~$3–$4M) and ongoing Google algorithm/SEO dynamics that are increasing the share of paid leads. Regulators and anti-fraud scrutiny (notably in California hospice) remain macro risks but Chemed says it supports enforcement while protecting legitimate access. As a result of VITAS’ stronger-than-expected quarter and share repurchases, Chemed raised 2026 guidance: full-year ADC growth 4.5%–5.5% (was 3.5%–4%); revenue growth excl. Medicare Cap 6.5%–7.5% (was 5.5%–6.5%); adjusted EBITDA margin excl. Cap 18.0%–18.5% (was 17.5%–18.5%). Roto revenue guide unchanged at 3.0%–3.5% but EBITDA margin modestly lowered to 21.5%–22.5% due to sustained higher marketing. 2026 adjusted diluted EPS guidance (ex certain items) is $20.00 to $24.75 (midpoint represents ~13% increase vs. 2025).