tiprankstipranks
Trending News
More News >
Universal Health (UHS)
NYSE:UHS
Advertisement

Universal Health (UHS) AI Stock Analysis

Compare
516 Followers

Top Page

UHS

Universal Health

(NYSE:UHS)

Rating:78Outperform
Price Target:
$209.00
▲(12.56% Upside)
Universal Health Services demonstrates strong financial performance with consistent growth and efficient debt management, which is the most significant factor in its overall score. Technical indicators suggest a positive trend, though caution is advised due to potential overbought conditions. Valuation metrics indicate the stock is undervalued, but the low dividend yield may deter some investors. The mixed sentiment from the earnings call reflects both growth prospects and operational challenges.
Positive Factors
Earnings
Reported revenue of $4.284 billion beat estimates by about 1%.
Financial Performance
UHS repurchased $151 million of shares during the quarter, indicating confidence in the company's future.
Valuation
The company's valuation remains incredibly undemanding, offering a significant discount compared to its peers and the broader market.
Negative Factors
Behavioral Health Performance
Behavioral health performance fell short of expectations, despite some revenue growth in core pricing.
Cash Flow
Cash flow from operations decreased compared to the previous year, despite being above estimates.
Operational Challenges
Incremental losses from Cedar Hill in the second half of the year are expected to impact company performance.

Universal Health (UHS) vs. SPDR S&P 500 ETF (SPY)

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 patient services in its hospitals and behavioral health facilities. The company bills for services rendered to patients, which is reimbursed by government programs like Medicare and Medicaid, as well as private insurance companies. Key revenue streams include inpatient and outpatient services, emergency room visits, and rehabilitation services. Additionally, UHS benefits from partnerships with various healthcare providers and payers, which can enhance patient referrals and optimize service delivery. The company's strategic acquisitions of healthcare facilities also contribute to its revenue growth by expanding its operational footprint and service offerings.

Universal Health Earnings Call Summary

Earnings Call Date:Jul 28, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with both positive developments in earnings guidance, acute care growth, and expansions in behavioral health, but also faced challenges with cash flow declines, start-up losses at a new medical center, lower than expected behavioral health volumes, and uncertainties surrounding Medicaid program changes.
Q2-2025 Updates
Positive Updates
Increased EPS Guidance
The midpoint of the 2025 EPS guidance was increased by 7% to $20.50 per diluted share, up from $19.20, primarily driven by increased DPP reimbursement.
Positive EBITDA Growth in Acute Care
Same-facility EBITDA for acute care increased by 10% during the second quarter of 2025, driven by a 5.7% increase in same-facility net revenues.
Behavioral Health Expansion
UHS expanded its behavioral health segment with the opening of new facilities, including a 96-bed Behavioral Hospital in Grand Rapids, Michigan, and a 41-bed treatment center in Mount Pleasant, South Carolina.
Share Repurchase Program
UHS repurchased 1.9 million shares at a total cost of approximately $332 million during the first half of 2025, continuing a trend of share repurchases since 2019.
Negative Updates
Cash Flow Decline
Cash generated from operating activities decreased by $167 million to $909 million during the first six months of 2025 compared to $1.076 billion in the same period in 2024.
Start-up Losses at Cedar Hill
Cedar Hill Regional Medical Center experienced a $25 million EBITDA drag in Q2, with similar expected losses in the second half of 2025 due to delays in obtaining Medicare certification.
Behavioral Health Volume Challenges
Behavioral health volumes grew only by 1.2%, falling short of the company's target of 2.5% to 3% adjusted patient day growth.
Medicaid Program Uncertainty
The One Beautiful Bill Act may reduce Medicaid net benefits by $360 million to $400 million by 2032, with uncertainties around its implementation and potential impact on UHS revenues.
Company Guidance
In the second quarter of 2025, Universal Health Services (UHS) reported a net income attributable to UHS per diluted share of $5.43, with an adjusted net income of $5.35 per share. The company experienced a 2.0% increase in adjusted admissions to acute care hospitals on a same-facility basis, while net revenues in this segment rose by 5.7%, excluding the impact of the insurance subsidiary. Behavioral health hospitals saw a 5.4% increase in net revenues, driven by a 4.2% rise in revenue per adjusted day and a 1.2% increase in adjusted patient days. Despite a decrease in cash generated from operating activities to $909 million from $1.076 billion year-over-year, UHS raised its 2025 EPS guidance midpoint by 7% to $20.50 per diluted share. The company also highlighted the potential impact of the One Beautiful Bill Act on Medicaid payments, predicting a reduction in net benefits by $360 million to $400 million annually by 2032. UHS emphasized ongoing de novo growth and strategic partnerships in its behavioral segment while noting operational challenges at newly opened hospitals in Las Vegas and Washington, D.C.

Universal Health Financial Statement Overview

Summary
Universal Health presents a strong financial position with consistent revenue and profit growth, efficient debt management, and healthy cash flows. While there are slight concerns over increasing debt levels, the overall financial health remains robust with solid profitability and equity positions.
Income Statement
85
Very Positive
Universal Health has shown consistent revenue growth with a 15.2% increase in revenue over the past year and a strong gross profit margin at 69.7% for TTM (Trailing-Twelve-Months). The net profit margin improved to 7.7% in TTM, indicating enhanced profitability. However, there was a slight decrease in EBIT margin from 10.6% in the previous year to 11% in TTM, signifying stability in operational efficiency.
Balance Sheet
78
Positive
The company's financial leverage appears well-managed with a debt-to-equity ratio of 0.71, showing a moderate level of debt. The equity ratio stands at 46.9%, suggesting a solid equity foundation. Return on equity has improved to 17.9% in TTM, reflecting better utilization of shareholder funds. However, the total debt has increased slightly, which could pose a risk if not controlled.
Cash Flow
82
Very Positive
Operating cash flow is robust with a slight reduction year-over-year, but remains healthy at $1.9 billion for TTM. Free cash flow growth rate shows a decline, yet it remains positive, suggesting that the company is generating sufficient cash to cover capital expenditures. The operating cash flow to net income ratio is 1.51, indicating strong cash earnings relative to net income.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue16.46B15.83B14.28B13.40B12.64B11.56B
Gross Profit14.84B14.24B12.75B11.93B11.21B10.27B
EBITDA2.43B2.27B1.71B1.58B1.91B1.87B
Net Income1.26B1.14B717.79M675.61M991.59M943.95M
Balance Sheet
Total Assets14.99B14.47B13.97B13.49B13.09B13.48B
Cash, Cash Equivalents and Short-Term Investments137.59M125.98M119.44M102.82M115.30M1.22B
Total Debt5.01B4.96B5.37B5.27B4.56B4.19B
Total Liabilities7.84B7.71B7.77B7.52B6.90B7.07B
Stockholders Equity7.03B6.67B6.15B5.92B6.09B6.32B
Cash Flow
Free Cash Flow901.52M1.12B524.74M262.02M28.04M1.63B
Operating Cash Flow1.90B2.07B1.27B996.02M883.70M2.36B
Investing Cash Flow-1.05B-911.11M-763.27M-647.30M-914.47M-802.56M
Financing Cash Flow-835.48M-1.14B-493.94M-318.40M-1.07B-384.86M

Universal Health Technical Analysis

Technical Analysis Sentiment
Positive
Last Price185.68
Price Trends
50DMA
175.10
Positive
100DMA
177.67
Positive
200DMA
181.11
Positive
Market Momentum
MACD
3.07
Negative
RSI
65.24
Neutral
STOCH
44.87
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UHS, the sentiment is Positive. The current price of 185.68 is above the 20-day moving average (MA) of 179.71, above the 50-day MA of 175.10, and above the 200-day MA of 181.11, indicating a bullish trend. The MACD of 3.07 indicates Negative momentum. The RSI at 65.24 is Neutral, neither overbought nor oversold. The STOCH value of 44.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UHS.

Universal Health Risk Analysis

Universal Health disclosed 32 risk factors in its most recent earnings report. Universal Health reported the most risks in the "Legal & Regulatory" 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 (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$11.81B9.5618.66%0.43%9.61%39.65%
75
Outperform
$16.38B11.9741.09%-1.09%-43.10%
73
Outperform
$12.46B24.1925.35%0.55%11.80%30.02%
71
Outperform
$14.28B19.854.72%3.24%1.11%25.84%
71
Outperform
$95.03B17.06-230.22%0.67%6.37%11.25%
62
Neutral
$9.79B13.36635.30%5.09%7.85%
51
Neutral
$7.91B-0.36-41.71%2.23%23.45%-1.86%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
UHS
Universal Health
185.68
-42.49
-18.62%
DVA
DaVita
135.56
-14.42
-9.61%
FMS
Fresenius Medical Care
24.31
5.00
25.89%
HCA
HCA Healthcare
411.59
26.70
6.94%
EHC
Encompass Health
124.48
33.43
36.72%
THC
Tenet Healthcare
192.52
39.12
25.50%

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.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Aug 26, 2025