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Baxter International Inc BAX

Morningstar Rating
$42.55 +0.54 (1.29%)
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Company Report

Baxter Earnings: Profit Turnaround Starting on Improving Medical Utilization

Narrow-moat Baxter turned in fourth-quarter and full-year 2023 results that were roughly in line with our expectations. Positively, Baxter's 2024 outlook looks a bit stronger than we were anticipating, and we are keeping our $67 fair value estimate intact. However, shares may be reacting to a weak outlook relative to FactSet consensus, suggesting that some analyst estimates may decline, although our profit expectations are rising slightly on improving trends.

Price vs Fair Value

BAX is trading at a 36% discount.
Price
$42.55
Fair Value
$95.00
Uncertainty
High
1-Star Price
$828.31
5-Star Price
$26.70
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

In the long run, Baxter should continue to grow at a decent clip, primarily around evolutionary innovation in all of the major business lines and moderate pricing or mix improvements.

Bears

Although Baxter's products are essential for medical care and patient health, many have similar alternatives, which can limit pricing power.

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News

Trading Information

Previous Close Price
$42.01
Day Range
$41.6242.87
52-Week Range
$31.0150.21
Bid/Ask
$41.40 / $43.00
Market Cap
$21.61 Bil
Volume/Avg
3.3 Mil / 4.0 Mil

Key Statistics

Price/Earnings (Normalized)
14.68
Price/Sales
1.35
Dividend Yield (Trailing)
2.73%
Dividend Yield (Forward)
2.73%
Total Yield
2.73%

Company Profile

Baxter offers a variety of medical instruments and supplies to caregivers. It enhanced its portfolio of hospital-focused offerings by acquiring Hillrom in late 2021, which added basic equipment, including hospital beds, to the portfolio, although about half of Hillrom's revenue comes from more digitally connected offerings like its smart beds and Voalte medical communications app. From its legacy operations, Baxter offers tools to help patients with acute and chronic kidney failure, which it plans to spin off by mid-2024. It also sells a variety of injectable therapies for use in care settings, such as IV pumps, administrative sets, and solutions; nutritional products; and surgical sealants and hemostatic agents.
Sector
Healthcare
Industry
Medical Instruments & Supplies
Stock Style Box
Mid Value
Total Number of Employees
60,000

Competitors

Valuation

Metric
BAX
BDX
FRE
Price/Earnings (Normalized)
14.6820.028.94
Price/Book Value
2.392.720.73
Price/Sales
1.353.550.54
Price/Cash Flow
13.9921.235.95
Price/Earnings
BAX
BDX
FRE

Financial Strength

Metric
BAX
BDX
FRE
Quick Ratio
0.910.460.18
Current Ratio
1.481.081.54
Interest Coverage
0.664.174.55
Quick Ratio
BAX
BDX
FRE

Profitability

Metric
BAX
BDX
FRE
Return on Assets (Normalized)
4.63%3.40%2.02%
Return on Equity (Normalized)
19.64%7.05%7.58%
Return on Invested Capital (Normalized)
6.97%5.04%3.46%
Return on Assets
BAX
BDX
FRE
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WST
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COO
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TFX
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