Universal Health Services, Inc. (UHS):

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SoTM Bull's Eye Report - Today's Most Compelling Buy
Monday, April 19, 2013

At StateoftheMarkets.com, we strive to "own the best and ignore the rest" in our equity portfolios. Toward this end, each day we search our database for a "top stock" (a top rated company in terms of earnings strength as well as company and industry performance) that presents a strong technical "set up" and a good entry point.

In short, when our equity team is looking to add a stock to one of our portfolios, the "bull's eye" stock shown below is generally their first choice.



Company


Symbol


Industry

Stock
Rating

YTD
% Gain
S.T.
Stop
Loss
Universal Health Services Inc UHS Health Care Facilities 9.2 +25.70% $59.08

Why We Like The Stock:

Universal Health Services Inc (UHS) is our most compelling buy today due to the fact that it is a top rated stock (in terms of earnings strength and company/industry performance) in the Health Care Facilities sub-industry. Health Care Facilities stocks have generally pulled back in early April, as noted on the charts of Tenet Healthcare Corp (THC), Community Health Systems (CYH), Brookdale Senior Living Inc (BKD), and Health Management Associates (HMA). However, UHS is a much better looking chart than this bunch - USH is the only one to hold above its 50-day moving average during the recent pullback, the pullback was significantly less severe, and it looks like UHS is turning a corner today as it breaks above its short term moving averages (rather than having a good day amidst a downtrend, which may be the case with a chart like THC). We like UHS at current prices as long as it can hold above Tuesday's intraday low at $59.08, which we would use as a stop. Our goal on a short-term trade would be around $66, which the stock flirted with April 2nd. Health Care Facilities stocks look to be turning a corner, and we like UHS the best out of this group.
We Would Be Buyers:

At the current price (~$61.45), or on a pullback to the 50-day moving average ($60.32).

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Company Profile:

Universal Health Services, Inc.owns and operates through its subsidiaries, acute care hospitals, behavioral health centers, surgical hospitals, ambulatory surgery centers and radiation oncology centers. As of February 28, 2013, it owned and/or operated 23 acute care hospitals and 197 behavioral health centers located in 37 states, Washington, D.C., Puerto Rico and the United States, Virgin Islands. Its operating segments consists of acute care hospital services and behavioral health care services. In October, 2012, it acquired Ascend Health Corporation (Ascend). Ascend was the private behavioral health provider with nine owned or leased freestanding inpatient facilities located in five states. In October of 2012, it completed the divestiture of Auburn Regional Medical Center (Auburn), a 159-bed acute care hospital located in Auburn, Washington.

Stock Rating:

The Stock Rating indicates the combined score of our proprietary Earning Strength and Company Performance models. The rating scale is 0 - 10 with 10 being the highest.

Disclosure:

At the time of publication the editor and affiliated companies own the following positions: UHS

Note: Positions may be bought or sold while this publication is in circulation without notice.

  Universal Health Services Inc - Last 3 Months

  Universal Health Services Inc - Last 12 Months

  Universal Health Services Inc - Last 5 Years

 

 

The analysis and information in this report and on our website is for informational purposes only. No part of the material presented in this report or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed nor any Portfolio constitutes a solicitation to purchase or sell securities or any investment program. The opinions and forecasts expressed are those of the editors of StateoftheMarkets.com and may not actually come to pass. The opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security nor specific investment advice. Stocks should always consult an investment professional before making any investment.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas , Business , Stocks

Referenced Stocks: BKD , CYH , HMA , THC , UHS

David Moenning


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