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Universal Health Services-B

UHSBelow valueExpectations · modest

Held by 3 superinvestors.

Price$175.76
Margin of safety−14%
Holders3
Total value$328.6M

SEC 10-K · fundamentals

Business quality

as of 2025-12-31

Valuation basis: trailing twelve months to 2026-06-30 — latest 10-K plus unaudited 10-Q filings.

Revenue growth
+9.7%
Net margin
8.6%
ROE
20.5%
FCF margin
4.9%
Revenue $11.56B → $17.36B · 6y
What makes a business high quality

Valuation · value band

Margin of safety

$205/ sh · growth-anchored intrinsic value
margin of safety
fair value
above fair value
$176
cheaperpricier

Zero-growth floor

$126

Central IV

$205

Optimistic top

$410

Universal Health Services-B (UHS): Two methods value the business — a conservative owner-earnings DCF and a growth-credited Greenwald estimate, $126–$410 / sh. Today’s price sits below both (price $176 as of 2026-08-25).

The middle figure is the main read. The right end is the optimistic case under the same conservative caps — not an absolute ceiling.

Revenue growth 3% (lower of historical trend and fundamental cap, capped by moat) · moat 10 yr · discount 11.4% · Zero-growth downside $126

Price as of 2026-08-25 · yahoo · DGS10 4.7% @ 2026-08-24.

Method & numbers

Model cautions

  • Owner-earnings yield diverges sharply from the 10-year Treasury (over 300 bps).
  • The two methods’ midpoints differ materially — growth assumptions warrant review (over 20%).

A conservative intrinsic-value band (zero-growth floor to growth-capped DCF) plus a tangible asset floor — not investment advice, not a buy/sell signal, and not a price target.

Owner-earnings DCF $147.10 – $245.09 · Greenwald $252.73 – $409.85 (neutral $326.95) · zero-growth base $178.16 · reproduction $57.69

Moat Franchise (moat) · terminal value 44% of present value · owner-earnings yield 10% vs 10Y 4.7%.

Graham earnings-power value (normalized NOPAT)$126.38 – $171.95 / sh

Normalized NOPAT = average operating margin over the years shown × latest-year revenue × (1 − normalized tax); then + D&A − maintenance capex (write A). Unlevered (pre-interest, attributable to all capital). Capitalized at the 9–11% rate band (read as a WACC proxy). Enterprise → equity bridge applied: + cash − total debt.

Years: TTM 2026-06-30, 2024, 2023, 2022, 2021

v1 simplifications: Maintenance capex (ok) deducted in full cash (write A): EPV = (NOPAT + D&A − maintenance capex) / WACC; no tax shield on the capex term. Share-based compensation is left as a real expense (not added back).

Buffett owner-earnings value$147.86 – $178.16 / sh

Owner earnings = average net income + average D&A − maintenance capex (zero-growth floor; no ΔNWC). Levered (starts from net income, already after interest — an equity-holder stream). Capitalized at the 9.8–11.8% band (9–11% base + 0.8pp leverage premium). No enterprise→equity bridge: the capitalized result is already equity value (subtracting debt would double-count interest).

Years: TTM 2026-06-30, 2024, 2023, 2022, 2021

v1 simplifications: Owner earnings = net income + D&A − maintenance capex (ok); the working-capital change is excluded (maintenance ΔNWC ≈ 0; growth ΔNWC is carried in growth value, not double-counted). One-time items are not separately normalized (multi-year averaging smooths them partially). Share-based compensation is left as a real expense (not added back); see the SBC/OE disclosure. Capitalized at the 9–11% base band plus a 0.8pp leverage premium (cost of equity rises with leverage — MM Proposition II). Net debt is about 4.5 years of owner earnings, adding 0.8pp of cost-of-equity risk premium.

Reproduction value = tangible net assets $3.46B = $57.69 / sh. Tangible net assets = shareholders' equity − goodwill − intangibles, ÷ diluted shares (no R&D history to capitalize).

Moat reading: Franchise test compares earnings power (EPV) against reproduction value on both AV_conservative (tangible + capitalized R&D) and AV_reproduction (conservative + acquired-reset proxy). Both must clear the franchise multiple for a moat signal; near it, a commodity; below it, value destruction. A directional reading, not a verdict.

Assumes a narrow moat · competitive-advantage period ≈ 10 years.

Growth value: if the moat holds for 10 yr at ROIIC ≈ 48%, $74.57–$231.69 / sh (neutral $148.80). Conservative, not a forecast.

Window TTM 2026-06-30, FY 2024, 2023, 2022, 2021 · discount band 9%–11% · normalized tax 21% (Average effective tax rate over 5 year(s), capped at the statutory 21%.) · diluted shares.

Baseline 9%–11%, net debt ≈ 4.5 years of owner earnings → +0.8pp cost-of-equity premium → effective 9.8%–11.8%.

Owner-earnings DCF: growth g₁ 3% · OE FY TTM 2026-06-30, 2024, 2023, 2022, 2021 · Discount band: 9.96%–12.76% (DGS10 +4.5% to a 12% strict end, each +0.76pp for leverage premium, as of 2026-08-24). No enterprise→equity bridge: owner earnings already flow to shareholders (post-interest), so no net cash is added and no debt subtracted — matching the engine owner-earnings lamp. Two-method midpoint gap 46%.

Valuation basis: trailing twelve months to 2026-06-30 — latest 10-K plus unaudited 10-Q filings.

What the price is betting

Today's price pencils in about 0.2% a year in owner-earnings for the next few years. Revenue actually grew 8.2% a year.

Below what it has already done.

Roughly, the price needs its historical revenue growth to run about 2 more years to hold up.

How to read intrinsic value

SEC 13F · holders

Superinvestors Holding This Security

3 holders · $328.6M combined · this quarter +0 opened / -0 exited

This quarter2 added1 trimmed
Holders 2 → 3 · last 8q

SEC 13F · notes

Written summary

Universal Health Services-B (UHS) is held by 3 of the superinvestors tracked on Compounder, with a combined $328.6M in reported 13F value. The largest position belongs to Richard Pzena, where it makes up 0.9% of the portfolio.

Other notable holders by value include Ray Dalio (0.1% of its book) and Jeremy Grantham (0.0% of its book).

Over the latest quarter, 0 of the tracked filers opened a new position in UHS, 2 added to existing ones, 1 trimmed, and 0 sold out entirely.

Holder counts and values reflect the most recent SEC Form 13F filings, through the quarter ended 2026-06-30. Source: SEC EDGAR. A 13F shows only long US-listed positions and can lag the real portfolio by up to 45 days, so this is disclosed long ownership, not a complete picture.

How to read a 13F

SEC 13F · co-ownership

Also held by these investors

Investors holding Universal Health Services-B (UHS) also commonly hold →

UHS's price is below its conservative value band. Browse all undervalued stocks by margin of safety

Also on

Sources· SEC EDGAR 13F as of 2026-06-30 · filed 2026-08-14

Educational data only — not investment advice. 13F positions are self-reported and can lag up to 45 days.

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