Universal Health Services (NYSE: UHS) and Community Health Systems (NYSE:CYH) are both medical companies, but which is the better business? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, profitability, institutional ownership, valuation and earnings.
Valuation & Earnings
This table compares Universal Health Services and Community Health Systems’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Universal Health Services||$10.11 billion||1.01||$1.71 billion||$7.35||14.58|
|Community Health Systems||$17.48 billion||0.04||$1.78 billion||($5.71)||-1.20|
Community Health Systems has higher revenue and earnings than Universal Health Services. Community Health Systems is trading at a lower price-to-earnings ratio than Universal Health Services, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Universal Health Services has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500. Comparatively, Community Health Systems has a beta of 1.63, meaning that its share price is 63% more volatile than the S&P 500.
Universal Health Services pays an annual dividend of $0.40 per share and has a dividend yield of 0.4%. Community Health Systems does not pay a dividend. Universal Health Services pays out 5.4% of its earnings in the form of a dividend.
Insider & Institutional Ownership
85.4% of Universal Health Services shares are held by institutional investors. Comparatively, 95.6% of Community Health Systems shares are held by institutional investors. 12.8% of Universal Health Services shares are held by company insiders. Comparatively, 4.6% of Community Health Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This is a breakdown of current recommendations for Universal Health Services and Community Health Systems, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Universal Health Services||0||7||5||0||2.42|
|Community Health Systems||4||11||1||0||1.81|
Universal Health Services presently has a consensus price target of $135.78, suggesting a potential upside of 26.68%. Community Health Systems has a consensus price target of $7.67, suggesting a potential upside of 12.18%. Given Universal Health Services’ stronger consensus rating and higher probable upside, research analysts clearly believe Universal Health Services is more favorable than Community Health Systems.
This table compares Universal Health Services and Community Health Systems’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Universal Health Services||7.10%||15.49%||7.08%|
|Community Health Systems||-3.63%||0.07%||0.01%|
Universal Health Services beats Community Health Systems on 10 of the 15 factors compared between the two stocks.
Universal Health Services Company Profile
Universal Health Services, Inc. is a holding company. The Company’s principal business is owning and operating, through its subsidiaries, acute care hospitals and outpatient facilities, and behavioral healthcare facilities. The Company’s segments include Acute Care Hospital Services, Behavioral Health Services and Other. As of February 28, 2017, the Company owned and/or operated 319 inpatient facilities, and 33 outpatient and other facilities, located in 37 states, Washington, District of Columbia, the United Kingdom, Puerto Rico and the United States Virgin Islands. The Company’s hospitals provide a range of services, such as oncology, diagnostic care, coronary care, pediatric services, pharmacy services and/or behavioral health services. As of February 28, 2017, its acute care facilities located in the United States included 26 inpatient acute care hospitals; four free-standing emergency departments, and four outpatient surgery/cancer care centers and one surgical hospital.
Community Health Systems Company Profile
Community Health Systems, Inc. is an operator of general acute care hospitals and outpatient facilities in communities across the country. The Company operates through hospital operations segment, which includes its general acute care hospitals and related healthcare entities that provide inpatient and outpatient healthcare services. The Company provides healthcare services through the hospitals that it owns and operates and affiliated businesses in non-urban and selected urban markets throughout the United States. The services provided through its hospitals and affiliated businesses include general acute care, emergency room, general and specialty surgery, critical care, internal medicine, obstetrics, diagnostic, psychiatric and rehabilitation services. The Company also provides additional outpatient services at urgent care centers, occupational medicine clinics, imaging centers, cancer centers, ambulatory surgery centers, and home health and hospice agencies.
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