Investment Thesis
UHS demonstrates solid operational fundamentals with double-digit operating margins (11.5%) and strong profitability metrics (20.5% ROE, 9.6% ROA), supported by consistent revenue growth of 9.7% YoY. The company generates healthy operating and free cash flow (FCF: $849.2M) with adequate interest coverage (12.8x), though tight liquidity (1.05x current ratio) and moderate leverage (0.65x debt/equity) warrant monitoring.
UHS Strengths
- Strong profitability with 11.5% operating margin and 8.6% net margin in healthcare services
- Excellent return metrics (20.5% ROE, 9.6% ROA) indicate efficient capital utilization
- Consistent revenue growth of 9.7% YoY with 37.3% diluted EPS growth
- Robust interest coverage ratio of 12.8x demonstrates comfortable debt servicing capacity
- Positive free cash flow generation of $849.2M provides financial flexibility
UHS Risks
- Tight liquidity position with current ratio of 1.05x limits operational flexibility for unexpected challenges
- Modest free cash flow margin of 4.9% relative to revenue suggests limited margin for error
- Significant long-term debt of $4.8B requires sustained operational performance and cash generation
- Healthcare sector exposure to regulatory, reimbursement, and labor cost pressures
- Limited cash reserves ($137.8M) relative to total assets suggests reliance on operational cash flow
Key Metrics to Watch
- Operating margin sustainability amid labor cost inflation and reimbursement changes
- Free cash flow growth trajectory and capital allocation decisions
- Current ratio and working capital management to ensure adequate liquidity buffers
- Debt/EBITDA ratio and leverage reduction progress
- Revenue growth rate and same-hospital utilization trends
UHS Financial Metrics
UHS Profitability Ratios
UHS Balance Sheet & Liquidity
UHS 5-Year Financial Trend
5-Year Trend Summary: UNIVERSAL HEALTH SERVICES INC's revenue has grown significantly by 37% over the 5-year period, indicating strong business expansion. The most recent EPS of $10.23 reflects profitable operations.
UHS Growth Metrics (YoY)
UHS Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $4.0B | $258.7M | $3.80 |
| Q2 2025 | $3.9B | $289.2M | $4.26 |
| Q1 2025 | $3.8B | $261.8M | $3.82 |
| Q3 2024 | $3.6B | $167.0M | $2.40 |
| Q2 2024 | $3.5B | $171.3M | $2.42 |
| Q1 2024 | $3.5B | $163.1M | $2.28 |
| Q3 2023 | $3.3B | $167.0M | $2.40 |
| Q2 2023 | $3.3B | $164.1M | $2.20 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
UHS Capital Allocation
UHS SEC Filings
Access official SEC EDGAR filings for UNIVERSAL HEALTH SERVICES INC (CIK: 0000352915)