Here's Why Investors Should Hold Ensign Group Stock for Now

The Ensign Group, Inc. ENSG is aided by improved service revenues, active pursuit of acquisitions and a strong financial position. Straight dividend hikes for 23 years also reinforce investors’ confidence in the stock.   Zacks Rank & Price PerformanceEnsign Group carries a Zacks Rank #3 (Hold) at present. The stock has gained 31.9% in the past year compared with the industry’s 29.3% growth. The Medical sector and the S&P 500 composite index have increased 5.6% and 18.2%, respectively, in the same time frame.Image Source: Zacks Investment ResearchFavorable Style ScoreENSG is well-poised for progress, as evidenced by its impressive VGM Score of A. Here, V stands for Value, G for Growth and M for Momentum, and the score is a weighted combination of all three factors.Robust Growth ProspectsThe Zacks Consensus Estimate for Ensign Group’s 2025 earnings is pegged at $6.50 per share, indicating an improvement of 18.2% from the year-earlier reading, while the same for revenues is $5.1 billion, implying a 18.9% increase from the prior-year actual. The consensus mark for 2026 earnings is pegged at $7.09 per share, indicating 9% growth from the 2025 estimate. The same for revenues stands at $5.6 billion, which indicates a rise of 11.3% from the 2025 estimate.Impressive Surprise HistoryENSG’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 2.27%.Solid Return on EquityEnsign Group’s efficiency in utilizing shareholders’ funds can be substantiated by its return on equity of 18.5%, against the industry’s negative return of 17.7%.  Key Business TailwindsEnsign Group’s revenue expansion is primarily driven by increasing service revenues, stemming from its advanced healthcare offerings across skilled nursing, rehabilitation, and senior living facilities. The aging U.S. population continues to fuel strong demand for senior care services, positioning Ensign favorably in the long term. Additionally, the increasing requirement for effective rehabilitation—helping individuals regain daily functionality—is anticipated to significantly contribute to the revenue growth of its Skilled Services segment.The company’s Standard Bearer segment also plays a pivotal role in its financial performance. This division generates consistent rental income by leasing post-acute care properties—owned by Ensign—to healthcare operators under triple-net lease agreements. These leases not only provide a stable revenue stream but also shift property-related costs to tenants, thereby enhancing operational efficiency.Ensign’s aggressive acquisition strategy further strengthens its growth trajectory. The company actively acquires facilities in diverse regions across the US, promoting collaboration with local care teams. This localized approach allows Ensign to better address specific regional healthcare needs and offer high-quality care to underserved communities.In December 2025, Ensign acquired the operations of four skilled nursing facilities in Colorado, Kansas and Arizona. These strategic acquisitions enhance Ensign's healthcare portfolio and national footprint. Currently, Ensign operates 373 healthcare facilities across 17 states and owns 156 real estate assets, with acquisitions remaining a core focus of its capital allocation strategy.To support this growth and ongoing investments, a strong financial foundation remains essential. Ensign benefits from healthy cash reserves and robust cash flow generation, enabling continued investment in strategic initiatives. These financial strengths also empower the company to deliver shareholder value through share repurchases and dividend payments. Notably, Ensign has increased its dividend for 23 consecutive years, with the most recent hike being 4%.ENSG’s Key RisksThe company continues to experience a sustained increase in expenses, which rose 18.3% year over year during the first nine months of 2025. This upward trend in costs presents a growing threat to profit margins, especially as operational utilization rises and labor market instability persists. Furthermore, ongoing negative free cash flow and escalating competition from emerging market players may add additional pressure to the company’s overall financial performance.Stocks to ConsiderSome better-ranked stocks in the Medical space are Collegium Pharmaceutical, Inc. COLL, Addus HomeCare Corporation ADUS and Intuitive Surgical, Inc. ISRG. While Collegium Pharmaceutical sports a Zacks Rank #1 (Strong Buy), Addus HomeCare and Intuitive Surgical carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.Collegium Pharmaceutical’s earnings surpassed estimates in each of the last four quarters, the average surprise being 10.63%. The Zacks Consensus Estimate for COLL’s 2025 earnings indicates a 17.1% rise, while the same for revenues implies an improvement of 24.2% from the respective prior-year figures. The consensus mark for COLL’s earnings has moved 6.6% north in the past 60 days.The bottom line of Addus HomeCare outpaced estimates in three of the trailing four quarters and matched the mark once, the average surprise being 2.87%. The Zacks Consensus Estimate for ADUS’ 2025 earnings indicates a 17.7% rise, while the same for revenues implies an improvement of 22.9% from the respective prior-year figures. The consensus mark for ADUS’ earnings has moved 0.7% north in the past 60 days.Intuitive Surgical’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 16.34%. The Zacks Consensus Estimate for ISRG’s 2025 earnings indicates a 17.9% rise, while the same for revenues implies an improvement of 18.7% from the respective prior-year tallies. The consensus mark for ISRG’s earnings has moved up 0.5% in the past 30 days. Shares of Collegium Pharmaceutical and Intuitive Surgical have gained 70.8% and 8%, respectively, in the past year. However, Addus HomeCare stock declined 13.8% in the same time frame. Zacks Naming Top 10 Stocks for 2026Want to be tipped off early to our 10 top picks for the entirety of 2026? History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2025, the Zacks Top 10 Stocks gained +2,530.8%, more than QUADRUPLING the S&P 500’s +570.3%.Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2026. Don’t miss your chance to get in on these stocks when they’re released on January 5. Be First to New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Intuitive Surgical, Inc. (ISRG): Free Stock Analysis Report Addus HomeCare Corporation (ADUS): Free Stock Analysis Report The Ensign Group, Inc. (ENSG): Free Stock Analysis Report Collegium Pharmaceutical, Inc. (COLL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks