NYSE:UHS appears to be flying under the radar despite its strong fundamentals.

UNIVERSAL HEALTH SERVICES-B (NYSE:UHS) is a hidden gem identified by our stock screening tool, featuring undervaluation and robust fundamentals. NYSE:UHS showcases decent financial health and profitability, coupled with an attractive price. Let's dig deeper into the analysis.

Assessing Valuation for NYSE:UHS

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NYSE:UHS was assigned a score of 8 for valuation:

• Based on the Price/Earnings ratio, UHS is valued cheaper than 84.21% of the companies in the same industry.
• Compared to an average S&P500 Price/Earnings ratio of 28.83, UHS is valued a bit cheaper.
• UHS is valuated reasonably with a Price/Forward Earnings ratio of 11.77.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of UHS indicates a rather cheap valuation: UHS is cheaper than 87.72% of the companies listed in the same industry.
• UHS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.60, which is the current average of the S&P500 Index.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of UHS indicates a rather cheap valuation: UHS is cheaper than 84.21% of the companies listed in the same industry.
• Based on the Price/Free Cash Flow ratio, UHS is valued cheaply inside the industry as 80.70% of the companies are valued more expensively.
• UHS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• The decent profitability rating of UHS may justify a higher PE ratio.
• UHS's earnings are expected to grow with 18.08% in the coming years. This may justify a more expensive valuation.

Evaluating Profitability: NYSE:UHS

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:UHS, the assigned 7 is noteworthy for profitability:

• With an excellent Return On Assets value of 5.81%, UHS belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
• Looking at the Return On Equity, with a value of 13.05%, UHS belongs to the top of the industry, outperforming 84.21% of the companies in the same industry.
• Looking at the Return On Invested Capital, with a value of 8.18%, UHS is in the better half of the industry, outperforming 79.82% of the companies in the same industry.
• The 3 year average ROIC (7.81%) for UHS is below the current ROIC(8.18%), indicating increased profibility in the last year.
• UHS's Profit Margin of 5.57% is amongst the best of the industry. UHS outperforms 84.21% of its industry peers.
• The Operating Margin of UHS (8.77%) is better than 81.58% of its industry peers.

Looking at the Health

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:UHS has received a 5 out of 10:

• UHS has a better Altman-Z score (2.96) than 71.93% of its industry peers.
• Looking at the Debt to FCF ratio, with a value of 8.23, UHS is in the better half of the industry, outperforming 68.42% of the companies in the same industry.

A Closer Look at Growth for NYSE:UHS

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NYSE:UHS was assigned a score of 5 for growth:

• UHS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 17.92%, which is quite good.
• The Earnings Per Share is expected to grow by 15.27% on average over the next years. This is quite good.
• When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Check the latest full fundamental report of UHS for a complete fundamental analysis.

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.