Education
About Us
Working with TipRanks
Follow Us
Universal Health Services (UHS)
:UHS
Top Page
Universal Health
(NYSE:UHS)
74Outperform
Positive Factors
Behavioral Health Leadership
UHS's leadership in inpatient behavioral health is well-regarded.
Financial Performance
Profitability in the behavioral segment has rebounded sharply and is slightly above pre-pandemic levels.
Negative Factors
Acute Care Segment
The acute care segment is facing challenges, with operating margins still below pre-pandemic levels due to increased physician fees.
Government Spending Cuts
Uncertainty around potential government spending cuts poses a challenge for the company.
Universal Health (UHS) vs. S&P 500 (SPY)
Market Cap
$11.38B
Dividend Yield0.46%
Average Volume (3M)1.10M
Price to Earnings (P/E)10.4
Beta (1Y)0.81
Revenue Growth10.82%
EPS Growth65.64%
CountryUS
Employees76,000
SectorHealthcare
Sector Strength76
IndustryMedical - Care Facilities
Share Statistics
EPS (TTM)16.83
Shares Outstanding57,951,940
10 Day Avg. Volume931,381
30 Day Avg. Volume1,104,913
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)N/A
Price to Sales (P/S)0.72
Price to Cash Flow (P/CF)4.30
P/FCF Ratio6.40
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$228.00Price Target Upside30.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Universal Health Business Overview & Revenue Model
Company DescriptionUniversal Health Services, Inc. (UHS) is a leading American healthcare management company that operates acute care hospitals, behavioral health facilities, and ambulatory centers. Founded in 1979, the company provides high-quality healthcare services through a robust network of facilities spread across the United States and the United Kingdom, focusing on delivering superior patient care and improving health outcomes.
How the Company Makes MoneyUHS generates revenue primarily through the operation of its acute care hospitals and behavioral health facilities. The company earns income from patient services, including inpatient and outpatient care, emergency room visits, and specialized medical services. Revenue is also generated through partnerships with insurance companies, government programs like Medicare and Medicaid, and direct patient payments. Additionally, UHS benefits from strategic acquisitions and expansions, which increase its service offerings and patient base, thereby enhancing profitability. Key factors contributing to earnings include efficient facility management, cost controls, and the ability to attract and retain skilled healthcare professionals.
Universal Health Financial Statement Overview
Summary
Universal Health exhibits strong financial performance with consistent revenue and profit growth, efficient operational management, and stable financial health. The company maintains a balanced capital structure with effective cash flow management, positioning it well within the healthcare services industry. Potential risks include maintaining profitability margins and managing leverage as the company continues to grow.Income Statement
Universal Health shows strong revenue growth, with revenue increasing from $11.36 billion in 2019 to $15.83 billion in 2024. The gross profit margin remains robust as all reported gross profit is recorded as total revenue, although this indicates a potential reporting anomaly. The net profit margin improved significantly from 7.16% in 2019 to 7.21% in 2024. EBIT and EBITDA margins also strengthened over the years, reflecting operational efficiency improvements.85
Very Positive
Balance Sheet
The company's balance sheet shows moderate leverage with a debt-to-equity ratio of 0.73 in 2024, reflecting a stable capital structure. The return on equity (ROE) improved from 12.96% in 2019 to 16.92% in 2024, indicating effective use of equity to generate profits. The equity ratio is stable, around 46.7% in 2024, suggesting a balanced approach between debt and equity financing.75
Positive
Cash Flow
Operating cash flow has consistently grown, reaching $2.07 billion in 2024, indicating strong cash generation capabilities. Free cash flow also improved significantly, suggesting effective cash management. The operating cash flow to net income ratio of 1.81 in 2024 reflects a strong cash conversion cycle, while the free cash flow to net income ratio of 0.98 indicates efficient utilization of profits into cash.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 15.83B | 14.28B | 13.40B | 12.64B | 11.56B | Gross Profit |
| 15.83B | 5.64B | 11.93B | 11.21B | 10.27B | EBIT |
| 1.68B | 1.18B | 1.00B | 1.36B | 1.36B | EBITDA |
| 2.27B | 1.72B | 1.64B | 1.93B | 1.87B | Net Income Common Stockholders |
| 1.14B | 717.79M | 675.61M | 991.59M | 943.95M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 125.98M | 119.44M | 102.82M | 115.30M | 1.22B | Total Assets |
| 14.47B | 13.97B | 13.49B | 13.09B | 13.48B | Total Debt |
| 4.96B | 5.37B | 5.27B | 4.56B | 4.19B | Net Debt |
| 4.83B | 5.25B | 5.17B | 4.44B | 2.97B | Total Liabilities |
| 7.71B | 7.77B | 7.52B | 6.90B | 7.07B | Stockholders Equity |
| 6.75B | 6.15B | 5.92B | 6.09B | 6.32B |
| Cash Flow | Free Cash Flow | |||
| 1.12B | 524.74M | 262.02M | 28.04M | 1.63B | Operating Cash Flow |
| 2.07B | 1.27B | 996.02M | 883.70M | 2.36B | Investing Cash Flow |
| -911.11M | -763.27M | -647.30M | -914.47M | -802.56M | Financing Cash Flow |
| -1.14B | -493.94M | -318.40M | -1.07B | -384.86M |
Universal Health Technical Analysis
Negative
174.53
Price Trends
181.81
Negative
186.11
Negative
199.74
Negative
Market Momentum
1.99
Negative
59.58
Neutral
84.47
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UHS, the sentiment is Negative. The current price of 174.53 is below the 20-day moving average (MA) of 178.98, below the 50-day MA of 181.81, and below the 200-day MA of 199.74, indicating a bearish trend. The MACD of 1.99 indicates Negative momentum. The RSI at 59.58 is Neutral, neither overbought nor oversold. The STOCH value of 84.47 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for UHS.
Universal Health Risk Analysis
Universal Health disclosed 31 risk factors in its most recent earnings report. Universal Health reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Universal Health Peers Comparison
Overall Rating
UnderperformOutperform
Sector (48)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $18.96B | 16.97 | 27.07% | ― | 19.24% | 8.57% | |
74 Outperform | $11.38B | 10.38 | 17.82% | 0.46% | 10.82% | 65.64% | |
73 Outperform | $8.68B | 22.72 | 58.41% | ― | 11.84% | 42.04% | |
72 Outperform | $10.29B | 22.85 | 24.52% | 0.65% | 11.91% | 28.47% | |
72 Outperform | $11.45B | 3.73 | 110.75% | ― | 0.57% | 440.71% | |
61 Neutral | $2.64B | 9.86 | 8.73% | ― | 7.69% | ― | |
48 Neutral | $6.36B | 1.09 | -49.92% | 2.63% | 17.17% | 0.95% |
* Healthcare Sector Average
Performance Comparison
UHS
Universal Health
174.53
3.59
2.10%
ACHC
Acadia Healthcare
27.37
-48.06
-63.71%
EHC
Encompass Health
97.96
16.23
19.86%
MOH
Molina Healthcare
346.71
-34.85
-9.13%
THC
Tenet Healthcare
120.35
18.51
18.18%
MEDP
Medpace Holdings
287.11
-121.60
-29.75%
Universal Health Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: -2.99% | Next Earnings Date: Apr 28, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong financial performance, with notable revenue growth in both acute care and behavioral health segments, effective expense management, and continued investment in expansion. However, increased liability reserves, uncertainties around Medicaid reimbursements, and challenges in behavioral health volume growth present areas of concern. Overall, the call reflects a cautiously optimistic outlook for 2025.Highlights
Strong Financial Performance
Universal Health Services reported net income per diluted share of $4.96 for Q4 2024. Adjusted net income per diluted share was $4.92. Cash generated from operating activities was $658 million in Q4 2024 compared to $452 million in Q4 2023.
Increase in Acute Care and Behavioral Health Revenues
Same facility net revenues in acute care hospitals increased by 8.7%, while behavioral health hospitals saw a revenue increase of 11.1% in Q4 2024.
Effective Expense Management
Premium pay costs were reduced from a peak of $153 million in Q1 2022 to $60 million in Q4 2024, indicating effective management of operating expenses.
Capital Expenditure and Expansion
Capital expenditures for 2024 were $944 million, consistent with forecasts. New hospitals were opened, including West Henderson Hospital, with plans to open Cedar Hill Medical Center soon.
Share Repurchase Program
In 2024, $599 million worth of shares were repurchased, continuing a trend since 2019, with 32% of shares outstanding repurchased since then.
Positive Outlook for 2025
EBITDA growth is forecasted in the mid-single digits, with stable cost trends and improvement in salary and wages anticipated.
Lowlights
Increased Liability Reserves
A $35 million increase was recorded in self-insured professional and general liability claims for Q4 2024, contributing to a $79 million increase for the full year.
Medicaid Reimbursement Uncertainty
There is uncertainty in ongoing Medicaid reimbursements, with 2025 forecasts excluding supplemental Medicaid revenues in Tennessee and DC pending CMS approval.
Malpractice Claims Volatility
Incremental malpractice expenses of $79 million above the initial plan were recorded, with future adjustments possible due to volatility in this area.
Challenges in Behavioral Health Volume
Behavioral health patient days growth was below expectations at the end of 2024, affected by holiday schedules and winter weather.
Company Guidance
During the fourth quarter earnings call for Universal Health Services (UHS), the company provided guidance for 2025, highlighting several key metrics and trends. UHS expects EBITDA growth in the mid-single digits, driven by stable salary and wage trends and effective expense control, with a projected 2.5% to 3% growth in same facility adjusted patient days in behavioral services. The company anticipates a slight decrease in total consolidated Medicaid supplemental payments compared to 2024, as the 2025 forecast excludes any supplemental Medicaid revenues from Tennessee and the District of Columbia pending approval. UHS also reported a significant $35 million increase to reserves for self-insured professional and general liability claims in the fourth quarter, contributing to a $79 million increase for the full year. For 2024, UHS generated $2.067 billion in cash from operating activities, with $944 million spent on capital expenditures, aligning with their forecast. The company repurchased $599 million of its own shares and maintained $1.17 billion of aggregate available borrowing capacity. UHS plans to continue investing in outpatient services and technology to enhance patient care and improve patient experience scores.Universal Health Corporate Events
Executive/Board Changes
Universal Health Sets 2025 Executive Compensation Goals
Neutral
Mar 20, 2025
On March 19, 2025, Universal Health’s Compensation Committee approved the 2025 annual incentive bonus performance goals and long-term incentive stock-based compensation awards for its executive officers. The bonuses for executives like Marc D. Miller and Steve G. Filton will be based entirely on corporate performance criteria, while others like Edward H. Sim and Matthew J. Peterson will have their bonuses partially determined by divisional income targets. Additionally, the company has updated employment agreements for Marc D. Miller and Alan B. Miller, outlining salary increases and conditions for bonuses and stock-based incentives.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.