Universal Health Services (UHS): Reevaluating Valuation Following Impressive Q3 Earnings and Revenue Increase
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 13 2025
0mins
Source: Yahoo Finance
Strong Q3 Performance: Universal Health Services (UHS) reported a 13% year-on-year revenue increase in Q3, exceeding expectations and contributing to a 16.1% share price return over 90 days, indicating positive momentum.
Valuation Considerations: Despite strong earnings and a solid balance sheet, questions remain about whether UHS is undervalued or if the market has already priced in future growth, with a fair value estimate of $249.94 suggesting it may be undervalued.
Growth Opportunities: UHS's investments in digital health, technology, and AI are expected to enhance operational efficiencies and productivity, positioning the company well for industry consolidation and long-term earnings growth.
Risks Ahead: Potential challenges such as Medicaid reimbursement cuts and labor shortages could impact UHS's margins and valuation, highlighting the importance of considering these risks in investment decisions.
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Analyst Views on UHS
Wall Street analysts forecast UHS stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for UHS is 248.00 USD with a low forecast of 190.00 USD and a high forecast of 302.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
15 Analyst Rating
7 Buy
7 Hold
1 Sell
Moderate Buy
Current: 203.020
Low
190.00
Averages
248.00
High
302.00
Current: 203.020
Low
190.00
Averages
248.00
High
302.00
About UHS
Universal Health Services, Inc. is a holding company. The Company operates, through its subsidiaries, including its management company. It is engaged in owning and operating acute care hospitals and outpatient facilities, and behavioral healthcare facilities. Its segments include acute care hospital services, behavioral health care services, and Other. It owns and operates approximately 359 inpatient facilities, and 60 outpatient and other facilities located in 39 states, Washington, D.C., the United Kingdom, and Puerto Rico. It provides services, which include general and specialty surgery, internal medicine, obstetrics, emergency room care, radiology, oncology, diagnostic care, coronary care, pediatric services, pharmacy services and/or behavioral health services. It also provides capital resources, as well as a variety of management services to its facilities, including information services, finance and control systems, physician recruitment services, and public relations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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Universal Health Services (UHS) Expected EPS Growth of 7.8%, Outpacing Industry Average
- Earnings Growth Potential: UHS has a historical EPS growth rate of 10.9%, with an expected EPS growth of 7.8% this year, significantly surpassing the industry average of -1.6%, indicating strong future profitability that attracts investor interest.
- Asset Utilization Efficiency: UHS's sales-to-total-assets (S/TA) ratio stands at 1.14, well above the industry average of 0.82, demonstrating the company's efficiency in asset utilization, thereby enhancing its competitive position in the market.
- Sales Growth Outlook: UHS is projected to achieve a sales growth of 5.2% this year, exceeding the industry average of 4.2%, which not only reflects the company's strong market performance but also has the potential to drive its stock price higher, attracting more investors.
- Earnings Estimate Revision Trend: The current-year earnings estimates for UHS have been revised upward by 0.4% over the past month, indicating increased market confidence in its future performance, further solidifying its appeal as a growth investment.
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