Universal Health Services Inc (UHS)

Short-term

Turnover ratios

Universal Health Services Inc's inventory turnover has been relatively stable over the past few years, with values ranging from 6.75 to 7.19. The sudden spike in inventory turnover in 2023 to 39.82 may indicate more efficient management of inventory or potentially a change in the company's sales strategy.

The receivables turnover ratio is not available for any of the years provided, indicating that there is missing data or the company does not report this metric. Receivables turnover is a measure of how quickly a company collects its outstanding accounts receivable, so the absence of this data makes it difficult to assess the company's efficiency in collecting payments from customers.

Similarly, data for payables turnover is not available for any of the years, so it is not possible to evaluate how effectively Universal Health Services is managing its accounts payables.

The working capital turnover ratio measures how efficiently a company is using its working capital to generate sales. Universal Health Services Inc's working capital turnover has fluctuated over the years, with the highest value in 2021 at 45.24 and the lowest in 2022 at 17.90. This variability may indicate changes in the company's operating cycle or working capital management strategies.

In conclusion, while Universal Health Services Inc has shown stable inventory turnover, the lack of data on receivables and payables turnover limits a comprehensive assessment of the company's efficiency in managing its assets and liabilities. The fluctuations in the working capital turnover ratio suggest varying levels of efficiency in utilizing working capital to drive sales.

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Average number of days

Universal Health Services Inc's activity ratios indicate how efficiently the company manages its resources and operations.

1. Days of Inventory on Hand (DOH):
- In 2020, the company had 53.96 days of inventory on hand, which decreased slightly to 52.90 days in 2021, and then increased to 54.10 days in 2022.
- However, there was a significant drop in inventory days to 9.17 days by the end of 2023, reflecting a potential improvement in inventory management.
- By 2024, the days of inventory on hand increased to 50.79 days, suggesting a need to closely monitor inventory levels.

2. Days of Sales Outstanding (DSO):
- Data for days of sales outstanding is not provided, indicating that information on the company's accounts receivable turnover is not available.
- Without this information, it is challenging to assess how quickly the company is collecting payments from its customers.

3. Number of Days of Payables:
- Information on days of payables is also missing, making it difficult to evaluate how long the company takes to pay its suppliers.
- Understanding the company's payment practices is crucial in managing cash flow and working capital effectively.

In conclusion, while the days of inventory on hand provide insights into the company's inventory management, the absence of data on days of sales outstanding and days of payables limits a comprehensive analysis of Universal Health Services Inc's overall efficiency in managing its working capital cycle.

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Long-term

The fixed asset turnover ratio measures the efficiency of a company in generating sales from its fixed assets. In the case of Universal Health Services Inc, the fixed asset turnover has shown a slight decrease from 2.15 in 2020 to 2.03 in 2021, then a slight increase to 2.10 in 2022. However, the data is not available for the years 2023 and 2024.

On the other hand, the total asset turnover ratio reflects how well a company utilizes all its assets to generate revenue. For Universal Health Services Inc, there has been a consistent improvement in this ratio over the years, increasing from 0.86 in 2020 to 1.09 in 2024. This indicates that the company is efficiently using its total assets to generate sales and revenue.

Overall, the trend in fixed asset turnover has been somewhat inconsistent, whereas the total asset turnover has shown a positive and consistent improvement, suggesting better efficiency in utilizing all assets to drive revenue growth over the years.