NYSE:UHS: good value for what you're paying.

Last update: Oct 30, 2024

Our stock screening tool has pinpointed UNIVERSAL HEALTH SERVICES-B (NYSE:UHS) as an undervalued stock option. NYSE:UHS retains a strong financial foundation and an attractive price tag. Let's delve into the specifics below.

Evaluating Valuation: NYSE:UHS

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. NYSE:UHS scores a 8 out of 10:

Based on the Price/Earnings ratio, UHS is valued cheaper than 86.84% of the companies in the same industry.
When comparing the Price/Earnings ratio of UHS to the average of the S&P500 Index (30.84), we can say UHS is valued rather cheaply.
A Price/Forward Earnings ratio of 11.39 indicates a reasonable valuation of UHS.
Based on the Price/Forward Earnings ratio, UHS is valued cheaply inside the industry as 89.47% of the companies are valued more expensively.
UHS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.57, 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 85.96% of the companies listed in the same industry.
84.21% of the companies in the same industry are more expensive than UHS, based on the Price/Free Cash Flow ratio.
UHS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
UHS has a very decent profitability rating, which may justify a higher PE ratio.
UHS's earnings are expected to grow with 23.53% in the coming years. This may justify a more expensive valuation.

Looking at the Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:UHS scores a 7 out of 10:

The Return On Assets of UHS (7.15%) is better than 92.98% of its industry peers.
With an excellent Return On Equity value of 15.53%, UHS belongs to the best of the industry, outperforming 89.47% of the companies in the same industry.
UHS has a better Return On Invested Capital (9.51%) than 87.72% of its industry peers.
The 3 year average ROIC (7.81%) for UHS is below the current ROIC(9.51%), indicating increased profibility in the last year.
UHS has a better Profit Margin (6.65%) than 88.60% of its industry peers.
UHS has a better Operating Margin (9.99%) than 85.96% of its industry peers.

Looking at the Health

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:UHS, the assigned 5 for health provides valuable insights:

UHS has a Debt to FCF ratio of 4.87. This is in the better half of the industry: UHS outperforms 79.82% of its industry peers.

How We Gauge Growth for NYSE:UHS

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NYSE:UHS, the assigned 5 reflects its growth potential:

The Earnings Per Share has grown by an impressive 42.24% over the past year.
Looking at the last year, UHS shows a quite strong growth in Revenue. The Revenue has grown by 9.93% in the last year.
Based on estimates for the next years, UHS will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.27% on average per year.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

More Decent Value stocks can be found in our Decent Value screener.

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

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.