Trade-Ideas: Universal Health Services (UHS) Is Today's New Lifetime High Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Universal Health Services ( UHS) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Universal Health Services as such a stock due to the following factors:

  • UHS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $57.4 million.
  • UHS has traded 10,338 shares today.
  • UHS is trading at a new lifetime high.

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More details on UHS:

Universal Health Services, Inc., through its subsidiaries, owns and operates acute care hospitals, behavioral health centers, surgical hospitals, ambulatory surgery centers, and radiation oncology centers. The stock currently has a dividend yield of 0.2%. UHS has a PE ratio of 16.0. Currently there are 11 analysts that rate Universal Health Services a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Universal Health Services has been 825,100 shares per day over the past 30 days. Universal Health Services has a market cap of $7.8 billion and is part of the health care sector and health services industry. The stock has a beta of 1.79 and a short float of 1.8% with 2.15 days to cover. Shares are up 4.4% year-to-date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Universal Health Services as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, solid stock price performance and compelling growth in net income. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • UHS's revenue growth trails the industry average of 16.7%. Since the same quarter one year prior, revenues slightly increased by 4.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.95, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.11, which illustrates the ability to avoid short-term cash problems.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Health Care Providers & Services industry and the overall market, UNIVERSAL HEALTH SVCS INC's return on equity exceeds that of both the industry average and the S&P 500.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The net income growth from the same quarter one year ago has exceeded that of the Health Care Providers & Services industry average, but is less than that of the S&P 500. The net income increased by 15.3% when compared to the same quarter one year prior, going from $119.78 million to $138.08 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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