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Universal Health (UHS)
NYSE:UHS
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Universal Health
(NYSE:UHS)
Rating:73Outperform
Price Target:―
Positive Factors
Earnings
Adjusted EBITDA of $598mn was above the Street at $572mn.
Financial Performance
Adjusted EPS of $4.84 beat Street estimates by 11%.
Negative Factors
Behavioral Health Volumes
In behavioral health, adjusted admissions declined 1.6% y/y, well below the Street at +2.9%.
Revenue
Revenue increased 6.7% y/y to $4.1bn, missing the Street by 1.4%.
Universal Health (UHS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.03B
Dividend Yield0.43%
Average Volume (3M)818.55K
Price to Earnings (P/E)10.5
Beta (1Y)0.75
Revenue Growth9.73%
EPS Growth51.87%
CountryUS
Employees99,300
SectorHealthcare
Sector Strength42
IndustryMedical - Care Facilities
Share Statistics
EPS (TTM)4.84
Shares Outstanding57,189,716
10 Day Avg. Volume735,944
30 Day Avg. Volume818,555
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)1.76
Price to Sales (P/S)0.00
P/FCF Ratio11.25
Enterprise Value/Market Cap1.40
Enterprise Value/Revenue0.27
Enterprise Value/Gross Profit2.06
Enterprise Value/Ebitda1.92
Forecast
1Y Price Target
$226.31Price Target Upside21.53% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
Universal Health Business Overview & Revenue Model
Company DescriptionUniversal Health Services, Inc., through its subsidiaries, owns and operates acute care hospitals, and outpatient and behavioral health care facilities. The company operates through Acute Care Hospital Services and Behavioral Health Care Services segments. Its hospitals offer general and specialty surgery, internal medicine, obstetrics, emergency room care, radiology, oncology, diagnostic and coronary care, pediatric services, pharmacy services, and/or behavioral health services. As of February 24, 2022, it owned and/or operated 363 inpatient facilities, and 40 outpatient and other facilities located in 39 states; Washington, D.C.; the United Kingdom; and Puerto Rico. The company also provides commercial health insurance services; and various management services, which include central purchasing, information, finance and control systems, facilities planning, physician recruitment, administrative personnel management, marketing, and public relations services. Universal Health Services, Inc. founded in 1978 and is headquartered in King of Prussia, Pennsylvania.
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 demonstrates strong financial health with consistent revenue growth, robust profitability, and effective cash flow management. Moderate leverage is offset by a solid equity position and growing cash flows, indicating a well-managed company poised for sustainable growth.Income Statement
Universal Health has demonstrated consistent revenue growth with a notable increase in total revenue from $11.56 billion in 2020 to $16.08 billion in TTM 2025. The gross profit margin remains robust, indicating effective cost management. Net profit margin has improved, reflecting enhanced operational efficiency. EBIT and EBITDA margins are strong, indicating solid profitability in core operations.84
Very Positive
Balance Sheet
The company maintains a healthy equity ratio, with stockholders' equity consistently representing a substantial portion of total assets. The debt-to-equity ratio shows moderate leverage, which is manageable given the company's strong equity base. Return on equity is improving, demonstrating effective use of equity capital.75
Positive
Cash Flow
Operating cash flow is strong, consistently exceeding net income, indicating good cash conversion. Free cash flow has grown significantly, supporting further investment and debt management. The cash flow metrics reflect strong financial health with ample liquidity to support operations and strategic initiatives.78
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 16.08B | 15.83B | 14.28B | 13.40B | 12.64B | 11.56B | Gross Profit |
| 8.17B | 14.24B | 5.64B | 11.93B | 11.21B | 10.27B | EBIT |
| 1.75B | 1.68B | 1.18B | 1.00B | 1.36B | 1.36B | EBITDA |
| 2.35B | 2.27B | 1.72B | 1.64B | 1.93B | 1.87B | Net Income Common Stockholders |
| 1.20B | 1.14B | 717.79M | 675.61M | 991.59M | 943.95M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 112.09M | 125.98M | 119.44M | 102.82M | 115.30M | 1.22B | Total Assets |
| 14.05B | 14.47B | 13.97B | 13.49B | 13.09B | 13.48B | Total Debt |
| 5.31B | 4.96B | 5.37B | 5.27B | 4.56B | 4.19B | Net Debt |
| 5.20B | 4.83B | 5.25B | 5.17B | 4.44B | 2.97B | Total Liabilities |
| 7.74B | 7.72B | 7.77B | 7.52B | 6.90B | 7.07B | Stockholders Equity |
| 6.26B | 6.75B | 6.15B | 5.92B | 6.09B | 6.32B |
| Cash Flow | Free Cash Flow | ||||
| 1.05B | 1.12B | 524.74M | 262.02M | 28.04M | 1.63B | Operating Cash Flow |
| 2.03B | 2.07B | 1.27B | 996.02M | 883.70M | 2.36B | Investing Cash Flow |
| -987.77M | -911.11M | -763.27M | -647.30M | -914.47M | -802.56M | Financing Cash Flow |
| -1.03B | -1.14B | -493.94M | -318.40M | -1.07B | -384.86M |
Universal Health Technical Analysis
Neutral
186.21
Price Trends
180.11
Positive
181.52
Positive
197.91
Negative
Market Momentum
4.32
Negative
51.83
Neutral
50.04
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UHS, the sentiment is Neutral. The current price of 186.21 is above the 20-day moving average (MA) of 184.81, above the 50-day MA of 180.11, and below the 200-day MA of 197.91, indicating a neutral trend. The MACD of 4.32 indicates Negative momentum. The RSI at 51.83 is Neutral, neither overbought nor oversold. The STOCH value of 50.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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 1 New Risks
1.
Changes U.S. and other countries' trade policies and other factors beyond our control may adversely impact our business and operating results. Q4, 2024
Universal Health Peers Comparison
Overall Rating
UnderperformOutperform
Sector (53)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $15.14B | 10.78 | 38.12% | ― | -1.79% | -41.85% | |
76 Outperform | $16.79B | 14.96 | 26.72% | ― | 16.71% | 12.23% | |
73 Outperform | $12.03B | 10.48 | 18.35% | 0.43% | 9.73% | 51.87% | |
69 Neutral | $8.42B | 22.36 | 65.82% | ― | 9.87% | 32.81% | |
68 Neutral | $12.27B | 25.13 | 25.33% | 0.56% | 11.21% | 30.38% | |
60 Neutral | $2.12B | 11.27 | 6.35% | ― | 5.48% | ― | |
53 Neutral | $5.14B | 3.03 | -43.89% | 2.83% | 16.75% | -0.06% |
* Healthcare Sector Average
Performance Comparison
UHS
Universal Health
186.21
10.55
6.01%
ACHC
Acadia Healthcare
22.53
-41.05
-64.56%
EHC
Encompass Health
118.90
35.00
41.72%
MOH
Molina Healthcare
305.23
-26.90
-8.10%
THC
Tenet Healthcare
162.98
31.85
24.29%
MEDP
Medpace Holdings
294.89
-95.66
-24.49%
Universal Health Earnings Call Summary
Earnings Call Date:Apr 28, 2025
(Q1-2025)
| % Change Since: 7.69%|
Next Earnings Date:Jul 28, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook for Universal Health Services with strong revenue growth and effective expense management across both acute care and behavioral health segments. However, challenges such as decreased cash flow and uncertainties surrounding Medicaid supplemental payments posed concerns.Q1-2025 Updates
Positive Updates
Increase in Acute Care Hospital Metrics
Adjusted admissions to acute care hospitals increased by 2.4% and same facility net revenues increased by 5.0% in the first quarter of 2025 compared to the previous year.
Behavioral Health Revenue Growth
Same-facility net revenues at behavioral health hospitals increased by 5.5% due to a 5.8% increase in revenue per adjusted day.
Strong Operating Expense Management
Operating expenses on a same facility basis increased by only 2.6%, contributing to a 21% increase in EBITDA after excluding Medicaid supplemental payments.
Positive EBITDA from New Hospital
West Henderson Hospital in Las Vegas, opened in late 2024, posted a modestly positive EBITDA in its first full quarter.
Significant Share Repurchase
The company repurchased 1 million shares at a cost of approximately $181 million in Q1 2025, continuing a long-term trend of share buybacks.
Negative Updates
Decrease in Operating Cash Flow
Cash generated from operating activities decreased from $396 million in Q1 2024 to $360 million in Q1 2025, partially due to delays in Medicaid supplemental payment receipts.
Behavioral Health Volume Challenges
Adjusted patient days at behavioral health hospitals were relatively flat due to the leap year comparison and adverse weather conditions.
Uncertainty in Medicaid Supplementals
Pending CMS approvals for Medicaid supplemental revenues in Tennessee and the District of Columbia, adding uncertainty to revenue projections.
Supply Chain and Tariff Concerns
Potential tariffs could impact 25% of supply chain purchases, although currently, no significant pressure is reported.
Company Guidance
During the UHS 2025 Q1 conference call, Steve Filton highlighted key metrics and guidance for the fiscal year. The company reported a net income attributable to UHS per diluted share of $4.80, with an adjusted figure of $4.84. Acute care hospital segment saw a 2.4% increase in adjusted admissions and a 5.0% rise in same-facility net revenues, excluding insurance subsidiary impacts. Operating expenses were well-managed, rising 2.6% on a same-facility basis. The EBITDA increased by 21% after excluding Medicaid supplemental payments. Behavioral health hospitals experienced a 5.5% increase in same-facility net revenues, driven by a 5.8% increase in revenue per adjusted day, despite relatively flat adjusted patient days. Cash generated from operating activities fell to $360 million, influenced by delays in Medicaid supplemental payments. UHS spent $239 million on capital expenditures and repurchased 1 million shares for $181 million. As of March 31, 2025, UHS had $1.02 billion of available borrowing capacity on its $1.3 billion revolving credit facility. The company reiterated its full-year earnings guidance, citing confidence in their underlying business performance despite external uncertainties.Universal Health Corporate Events
Executive/Board ChangesShareholder Meetings
Universal Health Holds Annual Stockholders Meeting
Neutral
May 15, 2025
On May 14, 2025, Universal Health held its Annual Meeting of Stockholders virtually. During the meeting, stockholders elected two Class II members to the Board of Directors for a term ending in 2028, ratified PricewaterhouseCoopers, LLP as the independent accounting firm for 2025, and voted against a proposal for annual director elections.
The most recent analyst rating on (UHS) stock is a Buy with a $240.00 price target. To see the full list of analyst forecasts on Universal Health stock, see the UHS Stock Forecast page.
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.