Universal Health Reports Mixed Q3 Results; Shares Decline


Shares of Universal Health Services, Inc. (UHS) declined 2.9% in Monday’s extended trade after the company reported mixed results for the third quarter of 2021.

The healthcare management company owns and operates acute care hospitals, behavioral health centers, surgical hospitals, ambulatory surgery centers and radiation oncology centers.

Adjusted earnings of $2.67 per share declined 7.2% year-over-year and lagged the Street’s estimate of $2.74 per share. Meanwhile, revenues jumped 8.4% to $3.16 billion and surpassed analysts’ expectations of $3.1 billion. (See Universal Health stock chart on TipRanks)

Adjusted admissions and patient days at the company’s acute care hospitals increased 12.4% and 10.9%, respectively, as compared to the third quarter of 2020. At behavioral healthcare facilities, adjusted admissions and patient days decreased 2.7% and 2.1%, respectively. (See Insiders’ Hot Stocks on TipRanks)

Last month, Leerink Partners analyst Jim Kelly initiated a Hold rating on the stock with a price target of $140 (upside potential of 4.7%).

The analyst said, “While UHS could see the largest SS growth rate in 3Q21 (+18%) – we see material downside risk building to 2022 earnings with our EBITDA forecasts about 10% below consensus.”

Based on 5 Buys, 4 Holds and 4 Sells, the stock has a Hold consensus rating. The average Universal Health price target of $164.69 implies 23.2% upside potential from current levels.

According to TipRanks’ Smart Score rating system, Universal Health gets a 6 out of 10, which indicates that the stock is likely to perform in line with market averages.

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