Universal Health Services (NYSE:UHS) Shares Gap Down Following Weak Earnings

Universal Health Services, Inc. (NYSE:UHS) shares gapped down prior to trading on Friday following a dissappointing earnings announcement. The stock had previously closed at $224.66, but opened at $208.00. Universal Health Services shares last traded at $207.18, with a volume of 277,375 shares changing hands.

The health services provider reported $3.71 EPS for the quarter, missing analysts’ consensus estimates of $3.75 by ($0.04). Universal Health Services had a net margin of 6.22% and a return on equity of 14.91%. The firm had revenue of $3.96 billion for the quarter, compared to analysts’ expectations of $3.90 billion. During the same quarter in the previous year, the company earned $2.55 EPS. The company’s quarterly revenue was up 11.3% compared to the same quarter last year.

Universal Health Services announced that its board has approved a share buyback program on Wednesday, July 24th that allows the company to repurchase $1.00 billion in shares. This repurchase authorization allows the health services provider to buy up to 8% of its shares through open market purchases. Shares repurchase programs are generally an indication that the company’s management believes its shares are undervalued.

Analyst Ratings Changes

A number of brokerages have recently issued reports on UHS. Cantor Fitzgerald reaffirmed a “neutral” rating and set a $219.00 price target on shares of Universal Health Services in a report on Friday. UBS Group upped their target price on shares of Universal Health Services from $247.00 to $267.00 and gave the company a “buy” rating in a research note on Wednesday, August 14th. Barclays lifted their price target on shares of Universal Health Services from $256.00 to $271.00 and gave the stock an “overweight” rating in a research note on Friday. StockNews.com upgraded shares of Universal Health Services from a “buy” rating to a “strong-buy” rating in a research report on Saturday, October 19th. Finally, KeyCorp initiated coverage on shares of Universal Health Services in a report on Friday, October 11th. They issued a “sector weight” rating on the stock. Five investment analysts have rated the stock with a hold rating, nine have issued a buy rating and two have assigned a strong buy rating to the stock. According to data from MarketBeat.com, Universal Health Services presently has a consensus rating of “Moderate Buy” and an average price target of $232.46.

Insider Transactions at Universal Health Services

In other news, Director Nina Chen-Langenmayr sold 850 shares of the company’s stock in a transaction on Wednesday, August 7th. The stock was sold at an average price of $212.11, for a total value of $180,293.50. Following the completion of the sale, the director now directly owns 1,985 shares in the company, valued at $421,038.35. This represents a 0.00 % decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at this link. In other news, Director Nina Chen-Langenmayr sold 850 shares of the firm’s stock in a transaction dated Wednesday, August 7th. The stock was sold at an average price of $212.11, for a total value of $180,293.50. Following the transaction, the director now owns 1,985 shares of the company’s stock, valued at $421,038.35. This trade represents a 0.00 % decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, Director Warren J. Nimetz sold 3,444 shares of the business’s stock in a transaction that occurred on Monday, August 12th. The shares were sold at an average price of $217.64, for a total value of $749,552.16. Following the transaction, the director now owns 3,971 shares of the company’s stock, valued at approximately $864,248.44. This trade represents a 0.00 % decrease in their ownership of the stock. The disclosure for this sale can be found here. Corporate insiders own 16.10% of the company’s stock.

Institutional Trading of Universal Health Services

Several institutional investors and hedge funds have recently modified their holdings of UHS. Point72 Asset Management L.P. lifted its position in shares of Universal Health Services by 362.3% in the second quarter. Point72 Asset Management L.P. now owns 322,626 shares of the health services provider’s stock valued at $59,663,000 after acquiring an additional 252,846 shares in the last quarter. Marshall Wace LLP lifted its holdings in Universal Health Services by 357.9% in the 2nd quarter. Marshall Wace LLP now owns 261,221 shares of the health services provider’s stock worth $48,308,000 after purchasing an additional 204,178 shares in the last quarter. Lazard Asset Management LLC boosted its stake in Universal Health Services by 1,191.8% in the 1st quarter. Lazard Asset Management LLC now owns 215,215 shares of the health services provider’s stock worth $39,267,000 after purchasing an additional 198,555 shares during the period. Lord Abbett & CO. LLC purchased a new stake in Universal Health Services during the 1st quarter valued at approximately $25,032,000. Finally, Pzena Investment Management LLC raised its position in shares of Universal Health Services by 41.2% during the first quarter. Pzena Investment Management LLC now owns 455,773 shares of the health services provider’s stock valued at $83,160,000 after buying an additional 132,942 shares during the last quarter. 86.05% of the stock is currently owned by institutional investors.

Universal Health Services Price Performance

The company has a quick ratio of 1.17, a current ratio of 1.28 and a debt-to-equity ratio of 0.67. The firm’s fifty day moving average price is $229.55 and its 200 day moving average price is $201.02. The stock has a market cap of $13.57 billion, a PE ratio of 17.18, a P/E/G ratio of 0.77 and a beta of 1.27.

Universal Health Services Company Profile

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.