Chemed Raises FY24 EPS From $23.30-$23.70 To $23.55-$23.80 Vs $23.21 Est.
Upward Revision to Guidance for 2024
VITAS 2024 revenue, prior to Medicare Cap, is estimated to increase 16.3% to 17.3% when compared to 2023. ADC is estimated to increase 13.3% to 14.4%. Full year adjusted EBITDA margin, prior to Medicare Cap, is estimated to be 19.3% to 19.7%. We are currently estimating $8.5 million in Medicare Cap billing limitations in calendar 2024. The cost of the retention program negatively impacted VITAS' 2023 full year adjusted EBITDA by 159 basis points.
Covenant Health is estimated to contribute approximately $30 million to $32 million of revenue to VITAS' full year revenue. There is no estimated Medicare Cap billing limitation expected related to Covenant Health. This translates into adjusted net income attributable to Covenant Health of $5.5 million to $6.0 million and adjusted EBITDA of $8.0 million to $8.5 million.
Roto-Rooter is forecasted to have a 4.0% to 5.0% revenue decline in 2024 compared to 2023. Roto-Rooter's adjusted EBITDA margin for 2024 is expected to be 26.5% to 27.0%.
Based on the above, full-year 2024 earnings per diluted share, excluding non-cash expense for stock options, tax benefits from stock option exercises, costs related to litigation and other discrete items, is estimated to be in the range of $23.55 to $23.80. This guidance assumes an effective corporate tax rate on adjusted earnings of 24.3% and a diluted share count of 15.25 million shares. Chemed's previously issued 2024 guidance range was $23.30 to $23.70. Chemed's 2023 reported adjusted earnings per diluted share was $20.30.