Enhabit approaches its May 14 Q1 2026 earnings report in an unusual position: short sellers are actively pulling back, yet options traders have moved sharply into defensive territory.
Short interest in the home health and hospice operator has fallen roughly 15% over the past month, dropping to 2.4% of the float — a level that carries little intrinsic squeeze risk. Borrowing costs are negligible at 0.40% annualised, and availability in the lending market remains extremely loose. The ORTEX short score has drifted down to 30.2 from 31.4 over the past week, reinforcing that short conviction is fading rather than building. The stock itself is nearly flat on the month at $13.79, down just 1.4%, after a 0.4% recovery this week.
Options positioning tells a sharply different story. The put/call ratio hit 1.53 on May 12 — a 52-week high and double the 20-day mean of 0.76. That swing has sent the PCR z-score to 1.2, pointing to heavy demand for downside protection in the run-up to the print. The pattern is striking: through most of April, the PCR sat below 0.15, meaning traders have completely reversed their posture in just a few weeks.
The fundamental backdrop gives bulls a reasonable starting point. EPS momentum rankings are strong — EHAB places in the 92nd percentile on 30-day EPS momentum and the 93rd on EPS surprise history, suggesting the company has repeatedly outperformed analyst expectations. Forward EPS growth ranks in the 85th percentile year-on-year. Revenue estimates point to around $1.1bn annually, with an EV/EBITDA of roughly 10.8x — a modest valuation for a cash-generative healthcare services business generating $90m in operating cash flow. The analyst community, however, has grown more cautious. Following the Q4 2025 print in late February and early March, TD Cowen, UBS, and Jefferies all downgraded the stock — though each simultaneously raised their price targets to around $13.80. That combination of target hikes and rating cuts reflects a consensus view that the stock's recovery from prior lows has been largely captured. The mean target of $13.80 sits virtually at the current price, leaving only 0.1% implied upside. Oppenheimer stands apart with an Outperform rating and a $14.00 target, the sole bullish voice among six covering analysts.
Insider activity adds a mild note of caution. The CFO and two executive vice presidents sold modest amounts of stock in early March — small transactions in dollar terms, and partly offset by routine equity awards — but the net 90-day insider position remains a net addition of roughly $4.7m, driven by awards rather than open-market purchases. On the institutional side, BlackRock and Vanguard each added small positions in recent months, while UBS Asset Management trimmed its stake materially.
The earnings report is therefore less about whether Enhabit is recovering and more about whether management can demonstrate that the operational improvements embedded in the upgraded consensus — and in an RSI that now sits at a measured 59 — are translating into durable margin progress at the unit level.
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