Shares of Encompass Health Corporation (EHC) surged 5.70% in Tuesday's pre-market trading session following the release of impressive second-quarter 2025 financial results and an optimistic outlook for the full year. The company, one of the largest providers of inpatient rehabilitation services in the U.S., demonstrated robust growth and operational efficiency that surpassed analysts' expectations.

Encompass Health reported Q2 2025 revenue of $1.46 billion, a 12.0% increase year-over-year, exceeding the consensus estimate of $1.427 billion. The company's non-GAAP earnings per share (EPS) reached $1.40, significantly topping the expected $1.23 and showing a remarkable 26.1% growth compared to the same quarter last year. This strong performance was driven by increased patient discharges, improved pricing, and a favorable shift in the payer mix towards higher-reimbursement insurance categories.

In response to these stellar results, Encompass Health's management raised its full-year 2025 guidance. The company now projects net operating revenue between $5.88 billion and $5.98 billion, up from the previous forecast of $5.85 billion to $5.93 billion. Adjusted EBITDA guidance was also increased to $1.22 billion–$1.25 billion, reflecting confidence in ongoing patient demand and operational effectiveness. Additionally, BofA Global Research raised its price objective for Encompass Health from $140 to $145, further boosting investor sentiment. As the company continues to expand its hospital network and improve operational efficiency, investors appear optimistic about its growth prospects in the inpatient rehabilitation sector.