EHAB - Is Enhabit Dead? Not Quite Yet
2024-07-15 10:00:00 ET
Summary
- It is soon to be the last independent home health and hospice company.
- Scarcity value could drive interest from financial and strategic bidders.
- Shareholders have a slate of new directors to refresh the company.
I disclosed my position on StW last quarter, writing that:
Is Enhabit Dead? Not Quite YetEnhabit ( EHAB ) provides home health and hospice services, one's own personal Florida where one gets as comfortable as possible after the grim reaper has marked his calendar but not yet arrived.
Enhabit
It is a recent spin-off... one of the promising categories presented in You Can Be a Stock Market Genius . Earlier this month, they flubbed a strategic review . Now 5% holder AREX Capital nominated a serious board slate to restart the process to sell the company to the highest bidder. EHAB is cheap compared with both comparable companies and comparable deals. Their two year anniversary of the spin is the first day of the third quarter, which is the safe harbor for pursuing a sale without complications from the IRS (possible but ballsy to try before then). Enhabit could recover to $12 as a standalone or $14-19 in a deal.