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Is Universal Health Services (UHS) a Great Value Stock Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

Universal Health Services (UHS - Free Report) is a stock many investors are watching right now. UHS is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 12.91, while its industry has an average P/E of 14.37. Over the last 12 months, UHS's Forward P/E has been as high as 15.12 and as low as 10.83, with a median of 12.43.

We also note that UHS holds a PEG ratio of 1.33. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. UHS's PEG compares to its industry's average PEG of 1.66. Within the past year, UHS's PEG has been as high as 4.84 and as low as 1.13, with a median of 1.64.

These are just a handful of the figures considered in Universal Health Services's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that UHS is an impressive value stock right now.


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