Universal Health Services (UHS) Lowered to “Sell” at Zacks Investment Research

Universal Health Services (NYSE:UHS) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a report released on Saturday.

According to Zacks, “Universal Health’s shares have underperformed the industry in last three months .The company is  exposed to integration risks owing to several acquisitions. Further, its highly leveraged balance sheet is a major headwind. Based upon the operating trends and financial results during the first nine months of 2017, the company has lowered its 2017 earnings guidance. However, its inorganic growth impresses. Consistent growth in its revenue base on the back of solid Acute Care and Behavioral Health platforms also remains a positive.”

Several other equities research analysts have also issued reports on UHS. Leerink Swann raised their price target on shares of Universal Health Services from $130.00 to $132.00 and gave the stock an “outperform” rating in a research note on Friday, September 22nd. Royal Bank of Canada restated a “buy” rating and set a $147.00 price target on shares of Universal Health Services in a research note on Tuesday, October 3rd. Stephens initiated coverage on shares of Universal Health Services in a report on Wednesday, October 11th. They issued an “equal weight” rating and a $120.00 price objective for the company. BMO Capital Markets initiated coverage on shares of Universal Health Services in a report on Monday, October 16th. They issued an “outperform” rating and a $125.00 price objective for the company. Finally, Robert W. Baird reaffirmed a “buy” rating and issued a $122.00 price objective on shares of Universal Health Services in a report on Friday, October 27th. Two equities research analysts have rated the stock with a sell rating, three have assigned a hold rating and eleven have assigned a buy rating to the company’s stock. The stock presently has an average rating of “Buy” and an average price target of $130.50.

Shares of Universal Health Services (UHS) traded down $1.82 during mid-day trading on Friday, hitting $110.15. 1,543,797 shares of the stock traded hands, compared to its average volume of 931,242. The company has a debt-to-equity ratio of 0.80, a quick ratio of 1.16 and a current ratio of 1.26. Universal Health Services has a 12 month low of $95.26 and a 12 month high of $129.74. The stock has a market cap of $10,460.00, a price-to-earnings ratio of 15.15, a P/E/G ratio of 2.36 and a beta of 0.97.

Universal Health Services (NYSE:UHS) last issued its quarterly earnings results on Wednesday, October 25th. The health services provider reported $1.49 earnings per share (EPS) for the quarter, missing the Thomson Reuters’ consensus estimate of $1.76 by ($0.27). Universal Health Services had a return on equity of 15.13% and a net margin of 6.90%. The company had revenue of $2.51 billion for the quarter, compared to analysts’ expectations of $2.60 billion. During the same quarter in the previous year, the business earned $1.60 EPS. The company’s revenue for the quarter was up 4.4% on a year-over-year basis. equities research analysts anticipate that Universal Health Services will post 7.36 earnings per share for the current fiscal year.

Universal Health Services declared that its board has approved a stock buyback program on Wednesday, November 15th that allows the company to repurchase $400.00 million in shares. This repurchase authorization allows the health services provider to purchase shares of its stock through open market purchases. Shares repurchase programs are often an indication that the company’s management believes its shares are undervalued.

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Orbimed Advisors LLC bought a new position in Universal Health Services in the 3rd quarter valued at $74,219,000. Shell Asset Management Co. boosted its holdings in Universal Health Services by 22.1% in the 3rd quarter. Shell Asset Management Co. now owns 36,647 shares of the health services provider’s stock valued at $3,830,000 after purchasing an additional 6,645 shares during the period. Quantum Capital Management boosted its holdings in Universal Health Services by 44.7% in the 2nd quarter. Quantum Capital Management now owns 69,969 shares of the health services provider’s stock valued at $8,542,000 after purchasing an additional 21,614 shares during the period. Sei Investments Co. boosted its holdings in Universal Health Services by 17.5% in the 3rd quarter. Sei Investments Co. now owns 16,456 shares of the health services provider’s stock valued at $1,826,000 after purchasing an additional 2,455 shares during the period. Finally, Victory Capital Management Inc. boosted its holdings in Universal Health Services by 54.6% in the 3rd quarter. Victory Capital Management Inc. now owns 17,516 shares of the health services provider’s stock valued at $1,943,000 after purchasing an additional 6,189 shares during the period. 86.07% of the stock is owned by institutional investors.

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About Universal Health Services

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.

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