Chemed tops Q3 profit estimates, sees 2026 EPS near high end

Chemed Corporation (CHE) said on Oct. 27 in a press release furnished with an 8-K that adjusted diluted earnings per share rose to $6.75 in the third quarter of 2026, topping the $6.50 consensus estimate compiled by Finnhub.

Revenue was $690.94 million, in line with the $691.89 million estimate. The results cover the quarter ended Sept. 30, 2026. The company operates through VITAS Healthcare, which provides hospice care, and Roto-Rooter, a plumbing and drain cleaning business.

On a GAAP basis, diluted EPS was $5.45, up 22.2% from a year earlier. Total revenue increased 10.6% from a year earlier.

Here's how the company did:

• Adjusted diluted EPS: $6.75 vs. $5.27 a year earlier; $6.50 expected, according to Finnhub
• GAAP diluted EPS: $5.45 vs. $4.46 a year earlier
• Revenue: $690.94 million vs. $624.9 million a year earlier; $691.89 million expected, according to Finnhub

Revenue has risen in each of the last three quarters, from $624.9 million in the third quarter of 2025 to $673.3 million in the second quarter of 2026, according to its SEC filings.

VITAS results

VITAS net revenue was $457.4 million, up 12.2%. The company attributed the growth mainly to a 9.4% increase in days of care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.2%.

Average daily census was 24,428, up 9.4%. Admissions rose 7.2% to 18,995.

Adjusted EBITDA, excluding Medicare Cap, was $92.5 million, up 31.4%. That is earnings before interest, taxes, depreciation and amortization, adjusted for certain items. Its margin on that basis was 20.2%, an increase of 318 basis points.

VITAS accrued $828,000 in Medicare Cap billing limitation in the quarter, against $6.1 million a year earlier. No Medicare Cap billing limitation was recorded for the Florida combined program in the quarter, and none is anticipated for the 2026 fiscal period.

Of its 33 Medicare provider numbers, 21 have an anticipated full-year Medicare Cap cushion of 10% or greater, seven have a cushion between 0% and 10%, and five have a Medicare Cap billing limitation totaling $6.1 million.

Gross margin excluding Medicare Cap was 25.4%, up 221 basis points. Average revenue per patient per day was $209.11, 196 basis points above the prior-year period.

Roto-Rooter results

Roto-Rooter revenue was $233.5 million, up 7.5%. Branch commercial revenue was $59.9 million, up 9.0%, and branch residential revenue was $158.8 million, up 5.2%.

Adjusted EBITDA fell 2.5% to $48.2 million. Its margin was 20.6%, down 213 basis points. Net income excluding certain discrete items was $33.3 million, down 1.8%.

Selling, general and administrative expenses were $71.0 million, up 17.1% from a year earlier. Gross margin was 50.3%, against 50.7% a year earlier.

During the quarter, Roto-Rooter re-acquired franchise territories in California for approximately $62.5 million. The territories include a population of over 12 million people. Two new branches will be established in Sacramento and San Diego, and other territories will be absorbed by existing branches.

Cash, debt and buybacks

As of Sept. 30, Chemed had $48.4 million in cash and cash equivalents and $236.0 million in long-term debt.

In April 2026, the company entered into a new five-year Amended and Restated Credit Agreement of $450 million. It consists of a $450 million revolving line of credit and a $250 million expansion feature, and carries a floating rate of SOFR plus 100 basis points. About $166.7 million was undrawn after excluding $47.3 million for letters of credit.

During the quarter, the company repurchased 125,000 shares for $66.0 million, or $528.24 per share. Over the trailing 12 months, it repurchased 1,235,000 shares at an average of $427.62 per share. About $73.7 million remained under its repurchase authorization as of Sept. 30.

Guidance

The company estimates that its full-year 2026 adjusted EPS will be at or slightly above the high end of its guidance. That guidance was $25.00 to $25.75 per diluted share, given on July 28. The company said further operational detail will be provided on its investor conference call.

Chemed will host the call and webcast on Oct. 28, 2026 at 10 a.m. ET.