Last week, you might have seen that Universal Health Services, Inc. (NYSE:UHS) released its third-quarter result to the market. The early response was not positive, with shares down 6.1% to US$177 in the past week. Results were roughly in line with estimates, with revenues of US$4.7b and statutory earnings per share of US$5.22. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Following the latest results, Universal Health Services' 16 analysts are now forecasting revenues of US$19.5b in 2027. This would be an okay 6.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to reduce 4.9% to US$23.58 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$19.5b and earnings per share (EPS) of US$24.06 in 2027. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
Check out our latest analysis for Universal Health Services
The analysts reconfirmed their price target of US$192, showing that the business is executing well and in line with expectations. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Universal Health Services, with the most bullish analyst valuing it at US$290 and the most bearish at US$156 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Universal Health Services' past performance and to peers in the same industry. We would highlight that Universal Health Services' revenue growth is expected to slow, with the forecast 4.8% annualised growth rate until the end of 2027 being well below the historical 8.1% p.a. growth over the last five years. Compare this to the 161 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 5.1% per year. Factoring in the forecast slowdown in growth, it looks like Universal Health Services is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at US$192, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Universal Health Services going out to 2028, and you can see them free on our platform here..
Even so, be aware that Universal Health Services is showing 2 warning signs in our investment analysis , and 1 of those can't be ignored...
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