We recently compiled a list of 35 Non-Tech Funds With Long-Term Investment Potential. In this article, we will look at how Universal Health Services, Inc. (NYSE:UHS) where it stands against other AI stocks.
Investors have been desperately looking for a safe way to play the AI boom that swept the US stock market in the past few months. Prominent investment bank Goldman Sachs recently released an investor note outlining which sectors of the economy will benefit from the AI craze, replacing bull cases in the tech space with thoughtful light on the long-term impact. of AI in applications, industry, shopping and retail. health care. According to Goldman analysts, AI tools looked set to help companies outside the technology sector improve productivity and reduce labor costs. The investment titan explained the endless passion for AI, proven by NVIDIA to be one of the most important firms in the world last year, and noted that the market would still reward companies with AI productivity is low.
Read more about these updates by accessing 30 The Most Valuable AI Stocks According to BlackRock and AI News You Shouldn’t Miss.
David Kostin, chief US equity strategist at Goldman, wrote in an investor report that the AI boom is likely to play out in four key stages. The first part, according to the analyst, focused on NVIDIA, the chip maker at the forefront of data center AI. Kostin explained that the second phase may be about companies building AI infrastructure. Some examples of this include the semiconductor, data center, network, cloud, and security industries, as well as utilities. So far this year, stocks operating in these industries have underperformed the returns of benchmark indexes. The third part, continued the analyst, will be about companies that are able to install AI in their products and boost sales in the process. Kostin warned that these firms have lost AI stocks in recent months.
The analyst said that firms falling into the fourth quarter of the AI boom, which would enjoy productivity gains after adopting AI, had been largely ignored by the market until now. Kostin confirmed that it is not clear whether these lower AI stocks, some of which are discussed in detail below, would accumulate and extend their earnings, but stressed that this it will happen eventually. The industrial sector highlights Goldman’s theory in action. Since the beginning of 2023, industrial production has increased by 30% in value. Of these, firms with direct exposure to AI verticals are more than twice as valuable. In the fourth quarter of 2023, more than 30% of industrial firms mentioned AI in their earnings reports, up from only 10% in the same period last year.
Read more about these updates by accessing The 33 Most Important AI Companies to Watch Out For and 20 industrial stocks are already riding the AI Wave.
Our method
For this article, we selected non-tech AI stocks by consulting an investor letter from the well-known investment firm Goldman Sachs. These stocks are also popular among hedge funds. Why are we interested in the stocks that hedge funds accumulate in? The reason is simple: our research has shown that we can outperform the market by mimicking the best hedge fund options. Our quarterly strategy picks 14 small and large stocks each quarter and has returned 275% since May 2014, outpacing its benchmark by 150 percent (see more details here).
Universal Health Services, Inc. (NYSE:UHS)
Number of Hedge Fund Holders: 46
Universal Health Services, Inc. (NYSE:UHS) consists of acute care hospitals, and outpatient and behavioral health centers. The firm integrates AI technologies in several areas to improve patient care and operational efficiency. Another important collaboration involves working with Hippocratic AI, which produces large-scale linguistic models (LLMs) specifically for healthcare. These models aim to solve health care problems, such as improving access and addressing workforce shortages. In addition, UHS uses Vital Software, an AI-powered platform that helps streamline communication with patients in hospitals. This system helps patients by providing real-time information about their health care journey, reducing staff workload, and improving patient satisfaction.
Universal Health Services, Inc. (NYSE:UHS) is one of the most followed health stocks on Wall Street. Baird analyst Michael Ha recently raised his price target to $274 from $236 and maintained an Outperform rating, reiterating the shares as a top pick for the hospital as 2Q performance confirms the theory- margin recovery issue about 15% 2Q adj. EBITDA margins, the highest since 2021. In the investor report, the consultant added that this was only the beginning of a strong story of improvement of the margin for many years.
Overall, UHS ranks 12th on our list of 35 non-tech stocks with long-term investment potential.. While we appreciate the ability of Universal Health Services, Inc. (NYSE:UHS) as an investment, our confidence is based on the belief that other AI stocks have great promise to deliver high returns, and do so in the short term. If you’re looking for a more promising AI stock than Universal Health Services, Inc. (NYSE:UHS) but trades at less than 5 times its earnings, check out our report on low price of AI stock.
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Description: None. This article was originally published on Insider Monkey.
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