Universal (US:UVV) ZACKSยท2024-09-09 17:50Core Viewpoint - Universal Health Services, Inc. (UHS) is experiencing growth driven by increasing patient volumes, a broad treatment network, and strong cash reserves, leading to a favorable business outlook for 2024 [1] Financial Performance - UHS has a Zacks Rank of 1 (Strong Buy) and has seen its stock price increase by 75.4% over the past year, outperforming the industry growth of 44.8% [2] - The Zacks Consensus Estimate for UHS's 2024 earnings is $15.91 per share, reflecting a 51% increase from 2023, with revenues expected to reach $15.7 billion, a 9.8% rise from 2023 [3] - For 2025, earnings are estimated at $17.45 per share, a 9.7% increase from 2024, with revenues projected at $16.5 billion, indicating a 5.5% growth [4] - UHS's price-to-earnings (P/E) ratio is 13.5, compared to the hospital industry's forward P/E of 15.77, suggesting the stock is undervalued [5] Growth Drivers - UHS's revenue growth is supported by rising patient volumes, with same-facility adjusted admissions increasing by 3.9% year-over-year in the Acute Care Hospital Services unit [7] - The resumption of deferred elective procedures is expected to further enhance patient volumes and occupancy levels [8] - UHS operates a comprehensive treatment network with 359 inpatient facilities and 48 outpatient facilities across multiple regions, which positions the company to meet rising demand, particularly in behavioral healthcare [9] Operational Strategy - UHS is enhancing operations by launching new services, expanding existing ones, and recruiting skilled physicians, which contributes to improved hospital performance and profitability [10] - The company maintains solid cash reserves and generated $1.1 billion in operating cash flow in the first half of 2024, allowing for investments in growth and consistent dividend payments [11]