Universal Health (UHS) AI Stock Analysis

• Market Cap: $11.37B
• Dividend Yield: 0.45%
• Average Volume (3M): 910.88K
• Price to Earnings (P/E): 9.4
• Beta (1Y): 0.71
• Revenue Growth: 9.61%
• EPS Growth: 39.65%
• Country: US
• Employees: 99,300
• Sector: Healthcare
• Sector Strength: 41
• Industry: Medical - Care Facilities
• EPS (TTM): 5.35
• Shares Outstanding: 56,388,016
• 10 Day Avg. Volume: 862,631
• 30 Day Avg. Volume: 910,885
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.47
• Enterprise Value/Revenue: 1.02
• Enterprise Value/Gross Profit: 1.46
• Enterprise Value/Ebitda: 6.91
• 1Y Price Target: $224.69
• Price Target Upside: 25.90% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 77 Outperform
• Price Target: $203.00 ▲(13.74% Upside)

Universal Health Services demonstrates strong financial performance and valuation metrics, with consistent revenue growth and efficient debt management. The earnings call provided a balanced view with positive EPS guidance but highlighted challenges such as cash flow declines and potential Medicaid impacts. Technical indicators suggest caution due to potential bearish sentiment.

Positive Factors

Financial Performance

Reported revenue of $4.284 billion beat estimates by about 1%.

Guidance

The company raised its 2025 guidance by $80 million at the midpoint.

Valuation

The company's valuation remains incredibly undemanding, offering a significant discount compared to its peers and the broader market.

Negative Factors

Behavioral Health

Behavioral health performance fell short of expectations, despite some revenue growth in core pricing.

EBITDA Performance

Normalized EBITDA of $567 million fell short of the model by 5.5%.

Hospital Performance

Incremental losses from Cedar Hill in the second half of the year are expected to impact company performance.

Universal Health Business Overview & Revenue Model

Company Description

Universal 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 Money

UHS 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 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

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

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

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.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	16.46B	15.83B	14.28B	13.40B	12.64B	11.56B
Gross Profit	11.48B	14.24B	12.75B	11.93B	11.21B	10.27B
EBITDA	2.43B	2.27B	1.74B	1.58B	1.91B	1.87B
Net Income	1.26B	1.14B	717.79M	675.61M	991.59M	943.95M
Balance Sheet
Total Assets	14.99B	14.47B	13.97B	13.49B	13.09B	13.48B
Cash, Cash Equivalents and Short-Term Investments	137.59M	125.98M	119.44M	102.82M	115.30M	1.22B
Total Debt	5.01B	4.96B	5.37B	5.27B	4.56B	4.19B
Total Liabilities	7.84B	7.71B	7.77B	7.52B	6.90B	7.07B
Stockholders Equity	7.03B	6.75B	6.15B	5.92B	6.09B	6.32B
Cash Flow
Free Cash Flow	901.52M	1.12B	524.74M	262.02M	28.04M	1.63B
Operating Cash Flow	1.90B	2.07B	1.27B	996.02M	883.70M	2.36B
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 Price: 178.47
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 178.47 is above the 20-day moving average (MA) of 166.36, above the 50-day MA of 173.60, and below the 200-day MA of 182.94, indicating a neutral trend. The MACD of 0.49 indicates Negative momentum. The RSI at 61.74 is Neutral, neither overbought nor oversold. The STOCH value of 96.14 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UHS.

Universal Health Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UHS	77 Outperform	$11.37B	9.41	18.66%	0.45%	9.61%	39.65%
EHC	73 Outperform	$11.95B	23.19	25.35%	0.57%	11.80%	30.02%
HCA	70 Outperform	$92.11B	16.54	-230.22%	0.70%	6.37%	11.25%
THC	70 Outperform	$15.06B	11.00	41.09%	―	-1.09%	-43.10%
FMS	66 Neutral	$14.55B	20.27	4.72%	3.16%	1.11%	25.84%
DVA	61 Neutral	$9.61B	13.21	635.30%	―	5.09%	7.85%
Sector *	51 Neutral	$7.46B	-0.25	-46.00%	2.25%	22.77%	-2.14%

Universal Health Corporate Events

Universal Health Holds Annual Stockholders Meeting

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.