Is Universal Health Services, Inc. overvalued or undervalued?

As of 11 June 2025, the valuation grade for Universal Health Services, Inc. has moved from very expensive to expensive. The company is currently considered overvalued based on its financial metrics. Key ratios include a P/E ratio of 10, a Price to Book Value of 1.80, and an EV to EBITDA of 7.18, which are relatively high compared to its peers. For instance, Tenet Healthcare Corp. has a P/E of 9.59 and an EV to EBITDA of 8.75, while Chemed Corp. shows a significantly higher P/E of 63.54, indicating a stark contrast in valuation.
The company's PEG ratio stands at a notably low 0.14, suggesting potential growth at a reasonable price, yet the high dividend yield of 46.01% may not be sustainable given the overall valuation context. In comparison to the S&P 500, Universal Health Services has underperformed over the past year, with a return of -8.24% compared to the index's 10.26%. Overall, the combination of these metrics suggests that Universal Health Services, Inc. is overvalued in the current market environment.