Can Chemed (CHE) Justify Its Valuation On Higher Earnings?

Chemed (CHE) has attracted fresh attention after reporting higher net income and earnings per share for both the third quarter and the first nine months of 2026 compared with a year earlier.

The recent earnings announcement and a fresh confirmation of Chemed’s quarterly dividend come as the share price sits at US$528.05, with a year-to-date share price return of 24.6% but a 3-year total shareholder return that has slipped 8.35%.

Compare Chemed’s latest earnings and dividend news with a hand picked pool of healthcare and service stocks that also screen well on balance sheet strength and fundamentals through our list of solid balance sheet and fundamentals (25 results)

Chemed combines hospice care and plumbing services in a profitable mix, and recent earnings back up that story. After a strong share price run, does that quality still come at a reasonable price today, or has it moved ahead of itself?

Most Popular Narrative: 21.8% Undervalued

Against Chemed’s last close at $528.05, the bullish analyst Narrative on Simply Wall St anchors on a fair value of $675, using a 7.24% discount rate and leaning on the most optimistic earnings and margin forecasts in the current analyst range.

An aging US population and management’s intention to pursue additional hospice starts and acquisitions in certificate of need states increase the long term demand pool for VITAS services, which can support sustained growth in average daily census, revenue and earnings.

At Roto-Rooter, the combination of higher paid lead volumes, a specialist search engine optimization partner focused on improving natural search visibility, and a growing commercial sales force is aimed at lifting total leads and commercial mix, which could support 3% to 3.5% revenue growth and a 22.5% to 23% adjusted EBITDA margin in 2026.

See why 4 investors see Chemed as 22% undervalued.

Result: Fair Value of $675 (UNDERVALUED)

Still, the bullish Chemed narrative depends on VITAS avoiding fresh Medicare Cap setbacks and on Roto Rooter containing paid digital lead costs that could otherwise squeeze margins.

Find out about the key risks to this Chemed narrative.

Next Steps

If the mix of upside and risk around Chemed feels finely balanced, do not wait for someone else’s verdict. Test the thesis yourself and weigh both sides through the 4 key rewards and 1 important warning sign

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