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What's in Store for Universal Health's (UHS) Q1 Earnings?

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Universal Health Services, Inc. UHS is set to report first-quarter 2021 results on Apr 26, after market close.

For the to-be-reported quarter, the Zacks Consensus Estimate for earnings is pegged at $2.15 per share, indicating an improvement of 24.3% from the year-ago reported figure.

Factors to Note

In the quarter to be reported, the company’s performance might have gained from solid revenues. The company is likely to have witnessed better admissions, on par with the pre-COVID levels.

The company’s segments, namely Acute Care and Behavioral Health, which have been contributing to its top line over the last several quarters, are likely to have benefited from higher admissions.

The consensus mark for net revenues at Acute Care and Behavioral Health suggests an improvement of 4.3% and 1.8% each from the respective prior-year reported numbers.

The company is likely to have witnessed better emergency room visits and elective or scheduled procedures.

The Zacks Consensus Estimate for total revenues stands at $2.9 billion, indicating growth of 3.6% from the year-earlier reported figure.

The consensus estimate for average licensed beds at Behavorial Health segment suggests a rise of 0.5% while the same for acute care (United States and Puerto Rico) indicates an increase of 0.3% from the respective year-ago reported figures.

At Behavioral Health Centers, the consensus mark for patient days hints at a decline of 2.3% from the prior-year reported number due to contracting patient volumes. The company has a pipeline of opening facilities to cater to people suffering behavioral health issues.

Patient days in the Acute Care segment are likely to have rebounded from prior-year levels. The estimate for patient days for acute care (the United States and Puerto Rico) indicates a 4.9% rise from the prior-year reported figure.

On its last earnings call, the board of directors declared of the resumption of its quarterly dividend of 20 cents per share, which was paid out on Mar 31.
Also, the company is expected to have incurred escalating expenses due to higher salaries, wages and benefits plus other operating expenses, which in turn, might have weighed on its margins.

What the Quantitative Model States

Our proven model doesn’t conclusively predict an earnings beat for Universal Health this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a positive surprise, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Universal Health has an Earnings ESP of -3.72%. This is because the the Most Accurate Estimate of $2.15 is higher than the Zacks Consensus Estimate of $2.07. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Universal Health Services, Inc. Price and EPS Surprise

Universal Health Services, Inc. Price and EPS Surprise
Universal Health Services, Inc. Price and EPS Surprise

Universal Health Services, Inc. price-eps-surprise | Universal Health Services, Inc. Quote

Zacks Rank: Universal Health currently carries a Zacks Rank #3.

Q4 Highlights and Surprise History

Universal Health reported fourth-quarter 2020 adjusted earnings of $3.59 per share, which surpassed the Zacks Consensus Estimate by 24.7%. Further, the bottom line improved 28.7% year over year. Results were aided by higher revenues, partly offset by escalating costs.

The company’s earnings managed to beat estimates in three of the trailing four quarters and missed the same in the remaining one. It has a trailing four-quarter surprise of 124%, on average.

Peer Results

Of the medical sector players that already reported first-quarter results so far, the bottom-line results of Tenet Healthcare Corporation THC, Anthem Inc. ANTM and UnitedHealth Group Incorporated UNH beat the respective Zacks Consensus Estimate.

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UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report

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