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Universal Health Services, Inc. (UHS) is a leading healthcare provider with a market cap of $15.9 billion, operating in the healthcare sector. Based in Pennsylvania, the company offers a broad range of services, including acute care, behavioral health care, and outpatient facilities, through its diverse portfolio of hospitals and specialized centers.
Shares of this hospital operator have significantly outperformed the broader market over the past 52 weeks. UHS stock has notably surged 78.1% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 26.1%. In 2024, shares of UHS are up 55.4%, compared to SPX's 17.2% gain on a YTD basis.
Looking closer, UHS has also outpaced the S&P Healthcare Services SPDR's (XHS) 10.2% returns over the past 52 weeks and a 10.3% YTD gain.
Universal Health Services has outperformed due to increased patient volumes, higher revenue per patient, effective cost management strategies that have begun to restore profit margins, and strong overall revenue growth. Moreover, the stock jumped 10.2% following its Q2 earnings release on Jul. 24. The company reported adjusted profit of $4.31 per share and revenue of $3.91 billion, surpassing analysts' estimates. Additionally, the company raised its annual profit forecast significantly, reflecting strong higher hospital admissions and robust revenue growth.
For the current fiscal year, ending in December, analysts expect UHS' EPS to grow nearly 51% year over year to $15.91. The company's earnings surprise history is promising. It beat the consensus estimates in all of the last four quarters.
Among the 17 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 10 “Strong Buy” ratings and seven “Holds.”
The configuration is more bullish than three months ago, with eight analysts suggesting a “Strong Buy” and one “Strong Sell” rating.
On Aug. 22, Bank of America Securities analyst Kevin Fischbeck maintained a “Buy” rating on Universal Health Services, setting a price target of $235.
As of writing, UHS is trading above the mean price target of $235.87. The Street-high price target of $267 implies a modest potential upside of 12.7%.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
