Universal Health Services’ stock remains a top value pick despite a lowered price target reflecting weaker surgical volumes and revised growth forecasts.
TD Cowen reduced Universal Health Services (NYSE:UHS) price target from $230 to $197 on June 22, maintaining a Buy rating. The new target implies a 24% upside from current levels. The adjustment follows a May hospital survey indicating flat revenue year-over-year, driven by weaker surgical procedure volumes partially offset by growth in other medical services.
The firm lowered its growth expectations for 2026 and 2027. Despite the revision, UHS remains a top extreme value stock, benefiting from broader industry trends, including AI-driven efficiency improvements in billing, staffing, and clinical documentation.
Large hospital operators like UHS, HCA Healthcare, and Tenet Healthcare are deploying AI to enhance profitability. Analysts believe these companies could maintain a competitive edge over nonprofit hospitals, supporting long-term growth prospects.