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    A Fresh Look at Chemed (CHE) Valuation as Shares Drift Modestly Lower

    Simply Wall St·10/03/2025 13:05:58
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    Chemed (CHE) shares saw modest movement today, continuing a trend seen over the past month. While there has not been a major announcement, investors may be watching for shifts in the company's healthcare services business.

    See our latest analysis for Chemed.

    While Chemed's share price has drifted slightly lower in recent months, the broader picture shows its longer-term total shareholder returns are flat to slightly negative over the past five years. This suggests that momentum has been lukewarm, and investor optimism remains muted for now.

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    Given Chemed's recent declines and a significant discount to analyst price targets, does the current valuation mark an overlooked entry point, or has the market already accounted for the company’s growth outlook?

    Most Popular Narrative: 24.1% Undervalued

    With Chemed trading at $442.04 per share and the most widely held narrative assigning a fair value of $582.25, the company’s potential upside stands out as notable. Market watchers may be focusing on what could trigger meaningful gains from here.

    The ramp-up of new Certificate of Need (CON) locations in underserved Florida counties (such as Pinellas and Marion) is expected to materially expand VITAS's service footprint, aligning with the continued aging U.S. population and the shift toward home-based care, which are both key drivers of higher patient volumes and long-term top-line revenue growth.

    Read the complete narrative.

    What makes this narrative particularly fascinating? There is a bold assumption baked in about future patient demand and healthcare trends. Behind the headline fair value, the real story involves shifting demographics, margin improvement, and an aggressive expansion strategy. Want to see the forecast scenarios and the surprising quantitative leap driving this outlook?

    Result: Fair Value of $582.25 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, reliance on Medicare reimbursement and margin pressures from rising labor and insurance costs could challenge Chemed’s long-term growth assumptions.

    Find out about the key risks to this Chemed narrative.

    Build Your Own Chemed Narrative

    If you see the story differently or want to dig into the numbers yourself, you can build a personalized view in just a few minutes. Do it your way

    A great starting point for your Chemed research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.