# Ensign Group Inc. (ENSG) — Financial Analysis

**Exchange:** NASDAQ  
**Coverage as of:** 2026-Q2  
**Updated:** 2026-05-29  
**Tier:** Free primer (step 2 of 19)  
**Sibling pages:** /stocks/ENSG/thesis · /stocks/ENSG/memo

## Financial Snapshot

---
source: coverage-next-full
ticker: ENSG
step: "04"
title: Financial Snapshot — 3-Year P&L Summary
created: 2026-05-29
---

### ENSG — Financial Snapshot (3-Year P&L Summary)

#### Annual Income Statement (USD millions)
| Metric | FY2022 | FY2023 | FY2024 | FY2025 |
|--------|--------|--------|--------|--------|
| Revenue | $3,025.5 | $3,729.4 | $4,260.5 | $5,057.8 |
| Revenue Growth | +15.1% | +23.3% | +14.2% | +18.7% |
| Operating Income | $296.8 | $255.4 | $358.3 | $425.3 |
| Operating Margin | 9.8% | 6.8% | 8.4% | 8.4% |
| Net Income | $224.7 | $209.4 | $298.0 | $344.0 |
| Net Margin | 7.4% | 5.6% | 7.0% | 6.8% |
| EPS (Diluted) | $3.95 | $3.65 | $5.12 | $5.84 |
| SBC | — | $30.8 | $36.2 | $48.3 |
| Shares (Diluted) | ~55.8M | 56.6M | 57.4M | 58.1M |

#### Key Ratios and Margin Analysis

##### Operating Margin Discussion
- FY2022 (9.8%) was temporarily elevated by residual COVID-era Medicare add-on payments phasing out
- FY2023 (6.8%) reflects transition: accelerated acquisition activity (heavy ramp costs) + COVID subsidy fadeout + elevated labor costs in the post-COVID normalization period
- FY2024–FY2025 (8.4%) represents normalized operating margin range; management targets continued improvement as acquired facilities mature
- EBITDA margin: estimated ~10–12% (adding ~$120–160M D&A to operating income); within top tier for SNF operators

##### Net Margin Discussion
- FY2023 dip (5.6% → 7.0% recovery in FY2024) reflects the $47.3M DOJ settlement impact recorded in 2023 operating results
- Clean net margin of 7–8% is high quality for post-acute care services (capital-light lease model with most properties rented)
- Tax rate approximately 27–28% in recent years (standard corporate rate)

#### Adjusted EPS vs. GAAP EPS
| Year | GAAP EPS | Adj. EPS | Key Adjustments |
|------|----------|----------|----------------|
| FY2023 | $3.65 | est. ~$4.20 | DOJ settlement, SBC, amortization |
| FY2024 | $5.12 | est. ~$5.70 | SBC, amortization of lease adjustments |
| FY2025 | $5.84 | $6.57 | SBC ($48.3M), amortization, lease adjustments |
| Q1 2026 | $1.67 | $1.85 | SBC, amortization |

The ~10–12% gap between GAAP and adjusted EPS is primarily SBC ($48.3M in FY2025, ~$0.83/share diluted). The SBC level (~1% of revenue) is not alarming given the company's size but is rising in absolute terms as management/employee equity plans scale.

#### Balance Sheet Summary (Year-End)
| Metric | FY2023 | FY2024 | FY2025 |
|--------|--------|--------|--------|
| Total Assets | $4,177.5M | $4,669.4M | $5,463.0M |
| Cash & Equivalents | $509.6M | $464.6M | $503.9M |
| PP&E (Net) | $1,090.8M | $1,291.4M | $1,696.9M |
| Operating Lease ROU Asset | $1,756.4M | $1,861.1M | $2,097.9M |
| Goodwill | $76.9M | $98.0M | $98.0M |
| Long-Term Debt | $152.4M | $148.4M | $144.4M |
| Operating Lease Liability | — | — | $2,064.0M |
| Total Equity | $1,491.9M | $1,837.1M | $2,231.7M |

#### Leverage and Capital Structure
- Financial debt is minimal: $144.4M LT debt on $5.06B revenue — essentially debt-free on traditional metrics
- Operating lease liabilities ($2.06B) represent SNF facility leases — standard for an operator that rents most of its buildings
- Net cash (ex-leases): Cash $503.9M minus LT debt $144.4M = ~$360M net cash
- Credit facility: Ensign maintains a revolving credit facility for acquisition financing; historically drawn minimally
- Ensign's balance sheet is clean relative to most SNF peers, who often carry sale-leaseback obligations and significant senior secured debt

#### Cash Flow Statement Summary
| Metric | FY2023 | FY2024 | FY2025 |
|--------|--------|--------|--------|
| Operating Cash Flow | $376.7M | $347.2M | $564.3M |
| Investing Cash Flow | -$182.7M | -$390.1M | -$513.2M |
| Financing Cash Flow | -$0.6M | -$2.2M | -$11.8M |
| Net Change in Cash | +$193.4M | -$45.0M | +$39.3M |
| Estimated Capex | ~$130M | ~$160M | ~$280M |
| Estimated Free Cash Flow | ~$247M | ~$187M | ~$284M |

Key observations:
- FY2025 operating CF surge to $564.3M (+62.5%) reflects earnings growth + working capital improvements
- FY2024 investing outflow (-$390.1M) signals accelerated acquisition activity (51 deals in 2025 partly funded in 2024)
- Financing cash flows minimal — ENSG does not rely on equity issuance or debt funding for growth
- FCF conversion: ~80–85% of net income (high quality, limited capex requirement for lease-based operators)

#### Key Financial Quality Indicators
| Indicator | Assessment |
|-----------|-----------|
| Revenue Growth Consistency | Excellent (15–23% annually, 5yr CAGR ~16%) |
| Margin Trend | Stable-improving (6.8%→8.4% op margin over 2023–2025) |
| Balance Sheet | Clean (minimal debt, growing equity) |
| Cash Flow Quality | High (FCF/NI ~80%+, no working capital issues) |
| EPS Growth | Strong ($3.65 → $5.84 in 2 years = +60%) |
| Dividend | Token ($0.25/share; ~0.15% yield at current price) |
| Capital Return | Modest (minimal buybacks; acquisitions prioritized) |

#### FY2026 Financial Outlook
| Metric | FY2026 Guidance | FY2025 Actual | Growth |
|--------|-----------------|---------------|--------|
| Revenue | $5.81–$5.86B | $5.06B | +15% |
| GAAP EPS | $7.48–$7.62 | $5.84 | +28% |
| Adj. EPS | ~$8.30–$8.45 | $6.57 | +27% |

Q1 2026 actuals ($1,389M revenue / $1.85 adj. EPS) are running ahead of the implied quarterly pace embedded in guidance, suggesting guidance may be conservative. Management has a 5+ year history of beating their own guidance by ~3–7%.

## Deeper Financial Analysis

The fundamental tier ($1.00) adds 8 dimensions not included here:

- Revenue Breakdown — segment revenue, geographic mix, product-line margins
- Financial Trends — QoQ momentum, leading indicators, inflection points
- Balance Sheet — debt structure, dilution risk, working capital dynamics
- Capital Allocation — ROIC, buyback cadence, reinvestment efficiency
- Earnings Analysis — beats/misses, guidance vs actuals, transcript highlights
- Competitive Positioning — market share, pricing power, peer benchmarks
- Industry Context — TAM, sector tailwinds/headwinds, regulatory backdrop

**API endpoint:** GET /api/v1/research/ENSG/fundamental

## Navigation

- Overview: /stocks/ENSG
- Financials (this page): /stocks/ENSG/financials
- Thesis: /stocks/ENSG/thesis
- Investment Memo: /stocks/ENSG/memo
- Coverage universe: /stocks