Value
5.6/10data confidence 60%| Component | Sub-score |
|---|---|
| P/S | 6.1 |
| EV/EBITDA | 2.9 |
| p ocf | 7.7 |
- ▸P/OCF: 12.4x (FFO proxy — REITs gated off P/E)
UHT · Why this verdict
Why Universal Health Realty Income (UHT) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.3/10
ConfidenceHIGH
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The bull case cites a high-quality business, supported by excellent cash conversion of 261% FCF-to-net-income and a strong Piotroski F-Score of 8 out of 9. Bull case | The Piotroski F-Score should stay at or above 7 out of 9 over the next 12 months, confirming durable fundamental strength. | →Stable |
| CounterStrong cash-conversion metrics for a healthcare REIT can mask tenant concentration risk that isn't visible in the quality score alone. | ||
The bear case notes the analyst target has already been reached with -22.1% implied upside, and the engine fails its asymmetry gate at -1.5, which is negative. Engine gate (failed) | The asymmetry ratio should turn positive, rising above 1.5, over the next 12 months as either the price pulls back or targets are raised. | →Stable |
| CounterREIT price targets often lag NAV growth, so a 'target reached' signal may understate continued total-return potential from distributions. | ||
The bear case flags a leverage penalty from a debt-to-equity ratio of 2.6, applying a -1.5 scoring drag. Bear case | Debt-to-equity should fall below 2.0 over the next 12 months to remove the leverage penalty. | →Stable |
| CounterLeverage near 2.6x is typical for a healthcare REIT financing long-duration, stable-cash-flow properties, and may not represent elevated risk in this sector. | ||
The catalyst notes flag a yield-trap warning, describing the dividend as high-yield but unsafe. Catalyst breakdown | The dividend-safety component score should rise above 6.0 over the next 12 months if the payout becomes more sustainable. | →Stable |
| CounterHealthcare REITs with long-term triple-net leases to hospital operators typically have durable, well-covered dividends despite a generic yield-trap flag. | ||
The bull case cites a high-quality business, supported by excellent cash conversion of 261% FCF-to-net-income and a strong Piotroski F-Score of 8 out of 9.
→StableBull case
- Expectation
- The Piotroski F-Score should stay at or above 7 out of 9 over the next 12 months, confirming durable fundamental strength.
CounterStrong cash-conversion metrics for a healthcare REIT can mask tenant concentration risk that isn't visible in the quality score alone.
The bear case notes the analyst target has already been reached with -22.1% implied upside, and the engine fails its asymmetry gate at -1.5, which is negative.
→StableEngine gate (failed)
- Expectation
- The asymmetry ratio should turn positive, rising above 1.5, over the next 12 months as either the price pulls back or targets are raised.
CounterREIT price targets often lag NAV growth, so a 'target reached' signal may understate continued total-return potential from distributions.
The bear case flags a leverage penalty from a debt-to-equity ratio of 2.6, applying a -1.5 scoring drag.
→StableBear case
- Expectation
- Debt-to-equity should fall below 2.0 over the next 12 months to remove the leverage penalty.
CounterLeverage near 2.6x is typical for a healthcare REIT financing long-duration, stable-cash-flow properties, and may not represent elevated risk in this sector.
The catalyst notes flag a yield-trap warning, describing the dividend as high-yield but unsafe.
→StableCatalyst breakdown
- Expectation
- The dividend-safety component score should rise above 6.0 over the next 12 months if the payout becomes more sustainable.
CounterHealthcare REITs with long-term triple-net leases to hospital operators typically have durable, well-covered dividends despite a generic yield-trap flag.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Universal Health Realty is a high-quality REIT with strong cash conversion, but its analyst target has already been reached near the 52-week high, leverage is elevated, and the asymmetry gate has failed, pointing toward reducing the position.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.7 |
| ROA | 2.7 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 8.8 |
| Current ratio | 5.0 |
| FCF quality | 10.0 |
| Moat | 5.2 |
| Rule of 40 | 7.8 |
| Piotroski F | 8.9 |
- ▸Strong margins: 18%
- ▸Excellent cash conversion: 261% FCF/NI
- ▸No competitive moat
- ▸Rule of 40: 46 (pass)
Growth
2.9/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.6 |
| EPS growth | 3.2 |
Momentum
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.0 |
| MACD | 10.0 |
| OBV | 5.4 |
| MA position | 9.0 |
| Volume | 0.0 |
- ▸Above 200-day MA
Sentiment
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 4.4 |
| erm sentiment | 5.0 |
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
3.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.8 |
| quality rank | 7.2 |
| growth rank | 3.1 |
- ▸Superior ROE vs peers
Technical
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.8 |
| support resistance | 2.8 |
| 52w position | 8.9 |
Risk (lower is worse)
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.5 |
| days to cover | 5.1 |
| volatility | 4.0 |
| put call | 8.3 |
| implied vol | 0.0 |
| beta | 7.9 |
| debt equity | 2.4 |
- ▸High IV: 101%
Catalyst
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 7.0 |
| dividend safety | 4.2 |
- ▸Earnings concerns: 2B/2M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:5.9>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:19d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.2=NEGATIVE
Warning (0)
none
Reward-to-Risk
-1.22
Upside
-18.3%
Downside
15.0%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 67, MACD bullish
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $0.6B<$5B
Investment implication
The F-path SELL output reflects an overall score of 3.8 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Insider at 7.3) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.2=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.22 — supplementary context, not the trigger for this path.
The strongest dimensions are Insider at 7.3, Quality at 7.2, and Momentum at 5.9; the weakest are Growth at 2.9, Peer rank at 3.8, and Technical at 4.8. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -1.22 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Quality Cash Conversion
Trip ifPiotroski F-Score falls below 5 out of 9, dropping from the current 8.
- P2Analyst Target Reached Negative Asymmetry
Trip ifAsymmetry ratio rises above 1.5, reversing the current -1.5 negative reading.
- P3Leverage Penalty Risk
Trip ifDebt-to-equity ratio rises above 3.5, worsening from the current 2.6.
- P4Yield Trap Dividend Risk
Trip ifThe company cuts its dividend by more than 10%, confirming the yield-trap warning materializes.