Universal Health Services (NYSE:UHS) Reaches New 12-Month High on Better-Than-Expected Earnings

Shares of Universal Health Services, Inc. (NYSE:UHS) hit a new 52-week high during trading on Thursday following a stronger than expected earnings report. The company traded as high as $196.55 and last traded at $195.09, with a volume of 35088 shares trading hands. The stock had previously closed at $185.97.

The health services provider reported $4.31 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $3.37 by $0.94. Universal Health Services had a return on equity of 13.34% and a net margin of 5.57%. The company had revenue of $3.91 billion for the quarter, compared to analyst estimates of $3.87 billion. During the same quarter in the previous year, the company earned $2.53 earnings per share. The firm’s quarterly revenue was up 10.1% compared to the same quarter last year.

Universal Health Services Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Tuesday, September 17th. Investors of record on Tuesday, September 3rd will be paid a dividend of $0.20 per share. This represents a $0.80 annualized dividend and a yield of 0.41%. The ex-dividend date is Tuesday, September 3rd. Universal Health Services’s payout ratio is 6.78%.

Universal Health Services announced that its Board of Directors has initiated a share buyback program on Wednesday, July 24th that allows the company to buyback $1.00 billion in outstanding shares. This buyback authorization allows the health services provider to repurchase up to 8% of its stock through open market purchases. Stock buyback programs are usually a sign that the company’s board of directors believes its shares are undervalued.

Wall Street Analyst Weigh In

Several research firms have recently commented on UHS. Stephens restated an “equal weight” rating and issued a $185.00 price objective on shares of Universal Health Services in a report on Thursday, April 25th. Baird R W upgraded shares of Universal Health Services from a “hold” rating to a “strong-buy” rating in a research note on Wednesday, June 26th. Deutsche Bank Aktiengesellschaft cut their price objective on Universal Health Services from $208.00 to $203.00 and set a “buy” rating on the stock in a research report on Friday, April 12th. TD Cowen lifted their target price on Universal Health Services from $181.00 to $183.00 and gave the company a “hold” rating in a report on Tuesday, April 30th. Finally, UBS Group upgraded Universal Health Services from a “neutral” rating to a “buy” rating and upped their price target for the stock from $189.00 to $226.00 in a report on Monday, May 20th. One equities research analyst has rated the stock with a sell rating, five have assigned a hold rating, seven have given a buy rating and two have issued a strong buy rating to the company. According to MarketBeat.com, Universal Health Services has a consensus rating of “Moderate Buy” and a consensus target price of $194.21.

Institutional Inflows and Outflows

Several large investors have recently modified their holdings of the stock. Vanguard Group Inc. raised its stake in Universal Health Services by 0.8% during the 1st quarter. Vanguard Group Inc. now owns 7,099,282 shares of the health services provider’s stock worth $1,295,335,000 after acquiring an additional 57,036 shares in the last quarter. Massachusetts Financial Services Co. MA increased its position in shares of Universal Health Services by 5.3% during the fourth quarter. Massachusetts Financial Services Co. MA now owns 2,071,022 shares of the health services provider’s stock worth $315,707,000 after purchasing an additional 103,802 shares in the last quarter. Goldman Sachs Group Inc. lifted its holdings in shares of Universal Health Services by 42.8% in the 4th quarter. Goldman Sachs Group Inc. now owns 736,542 shares of the health services provider’s stock valued at $112,278,000 after purchasing an additional 220,823 shares during the last quarter. Charles Schwab Investment Management Inc. boosted its position in shares of Universal Health Services by 1.0% in the 4th quarter. Charles Schwab Investment Management Inc. now owns 582,809 shares of the health services provider’s stock valued at $88,843,000 after purchasing an additional 5,557 shares during the period. Finally, Balyasny Asset Management L.P. grew its stake in Universal Health Services by 32,501.2% during the 4th quarter. Balyasny Asset Management L.P. now owns 570,847 shares of the health services provider’s stock worth $87,020,000 after buying an additional 569,096 shares during the last quarter. Institutional investors and hedge funds own 86.05% of the company’s stock.

Universal Health Services Stock Performance

The company has a quick ratio of 1.28, a current ratio of 1.38 and a debt-to-equity ratio of 0.75. The firm has a 50-day simple moving average of $184.35 and a 200 day simple moving average of $173.21. The company has a market cap of $13.04 billion, a price-to-earnings ratio of 15.77, a price-to-earnings-growth ratio of 0.88 and a beta of 1.28.

About Universal Health Services

Universal Health Services, Inc, through its subsidiaries, owns and operates acute care hospitals, and outpatient and behavioral health care facilities. It operates through Acute Care Hospital Services and Behavioral Health Care Services segments. The company's 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.