UHS
Universal Health Services, Inc.
$153.39
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 50.8% below fair value
You pay
$153.39
Bear
$249.35
Fair
$311.69
Bull
$374.03
Bear
$249.35
+62.6%
$23.19 × 12x P/E
Fair
$311.69
+103.2%
$23.19 × 15x P/E
Bull
$374.03
+143.8%
$23.19 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
6.6x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $207.71 from 43 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $311.69 per share.
Warnings
Wall Street's average price target is $207.71 (from 43 analysts). Our estimate is 72% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples