Key Highlights

  • Chemed reported third quarter adjusted diluted earnings per share of USD 6.75, an increase of 28.1% year over year.
  • GAAP diluted earnings per share were USD 5.45, up 22.2% from the prior year period.
  • VITAS Healthcare net revenue grew 12.2% to USD 457.4 million, driven largely by a 9.4% increase in days of care.
  • Roto-Rooter net income, excluding discrete items, declined 1.8% to USD 33.3 million for the quarter.

VITAS Segment Drives Overall Earnings Growth

Chemed (NYSE:CHE) reported third quarter adjusted diluted earnings per share of USD 6.75, up 28.1% from a year earlier, while GAAP diluted earnings per share were USD 5.45, up 22.2%. VITAS Healthcare net revenue increased 12.2% to USD 457.4 million, with the gain comprised primarily of a 9.4% increase in days of care and an approximately 2.2% increase in the geographically weighted average Medicare reimbursement rate.

Total VITAS admissions increased 7.2% during the quarter compared with the same period of 2025. A shift in patient acuity mix reduced revenue growth by 25 basis points, while Medicare Cap and other contra revenue adjustments added 85 basis points to the segment's growth rate.

Roto-Rooter Segment Shows Modest Softness

Roto-Rooter net income, excluding certain discrete items, declined 1.8% to USD 33.3 million for the quarter, with segment adjusted EBITDA of USD 48.2 million. The decline contrasts with the growth seen at VITAS, reflecting different demand dynamics between the company's hospice and plumbing services businesses.

Consolidated net income, excluding certain discrete items, was USD 70.8 million, up 44.7% from a year earlier, while consolidated adjusted EBITDA, excluding the impact of Medicare Cap, was USD 92.5 million, up 31.4%. The company's two segment structure means hospice growth can offset softer trends in its home services business in a given quarter.

Guidance Update and Segment Considerations

Based on results through September 30, 2026, the company said its results are tracking at or slightly above the high end of its full year 2026 adjusted earnings per share guidance issued alongside its second quarter results in July. Further operational detail on this outlook was provided during the company's conference call.

Continued growth in VITAS days of care and admissions could sustain the segment's double digit revenue growth, while any further softness at Roto-Rooter, which saw a slight net income decline this quarter, could affect the pace of consolidated earnings growth in subsequent periods.

Metrics for the Fourth Quarter

VITAS days of care and admissions growth relative to this quarter's 9.4% and 7.2% increases, respectively, further trends in Roto-Rooter segment profitability, and the final full year adjusted EPS outcome relative to the raised guidance range are among the data points the company has flagged. Medicare reimbursement rate changes remain a recurring variable in the VITAS segment's quarterly results.