UHS – Market expectations are for Uniform ROA compression, but management is confident about revenue growth, capacity, and acute care

• Universal Health Services, Inc. (UHS:USA) currently trades near historical averages relative to UAFRS-based (Uniform) Earnings, with a 15.7x Uniform P/E. At these levels, the market has somewhat bearish expectations for the firm, but management is confident about their ability to drive revenue growth, improving capacity, and their acute care business
• Specifically, management is confident that they are making progress towards revenue growth, and that only a relatively small number of markets and hospitals are being affected by staffing issues. Additionally, they are confident about their continued ramp up of new capacity, and that their main focus continues to be on revenue growth. Also, they are confident that the trend of moving lower acuity patients out of inpatient settings, which had hurt their acute care business in the past, is now bottoming out and stabilizing