BAXTER INTERNATIONAL INC (BAX) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:BAX - US0718131099 - Common Stock
19.65 USD
-0.19 (-0.96%)
19.5 USD
-0.15 (-0.76%)
Overall BAX gets a fundamental rating of 4 out of 10. We evaluated BAX against 184 industry peers in the Health Care Equipment & Supplies industry. BAX has a medium profitability rating, but doesn't score so well on its financial health evaluation. BAX has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year BAX was profitable.
- BAX had a positive operating cash flow in the past year.
- In multiple years BAX reported negative net income over the last 5 years.
- Each year in the past 5 years BAX had a positive operating cash flow.
1.2 Ratios
- With a decent Return On Assets value of -1.62%, BAX is doing good in the industry, outperforming 70.65% of the companies in the same industry.
- BAX has a Return On Equity of -4.71%. This is in the better half of the industry: BAX outperforms 71.20% of its industry peers.
- With a decent Return On Invested Capital value of 3.04%, BAX is doing good in the industry, outperforming 70.65% of the companies in the same industry.
- BAX had an Average Return On Invested Capital over the past 3 years of 3.50%. This is significantly below the industry average of 8.81%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.62% | ||
| ROE | -4.71% | ||
| ROIC | 3.04% |
ROA(3y)-0.58%
ROA(5y)1.52%
ROE(3y)-6.47%
ROE(5y)1.48%
ROIC(3y)3.5%
ROIC(5y)4.71%
1.3 Margins
- Looking at the Operating Margin, with a value of 6.37%, BAX is in the better half of the industry, outperforming 71.74% of the companies in the same industry.
- In the last couple of years the Operating Margin of BAX has declined.
- BAX's Gross Margin of 35.04% is on the low side compared to the rest of the industry. BAX is outperformed by 73.37% of its industry peers.
- BAX's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.37% | ||
| PM (TTM) | N/A | ||
| GM | 35.04% |
OM growth 3Y-19.11%
OM growth 5Y-13.17%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-1.94%
GM growth 5Y-2.16%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so BAX is destroying value.
- Compared to 1 year ago, BAX has more shares outstanding
- BAX has more shares outstanding than it did 5 years ago.
- BAX has a worse debt/assets ratio than last year.
2.2 Solvency
- BAX has an Altman-Z score of 2.24. This is not the best score and indicates that BAX is in the grey zone with still only limited risk for bankruptcy at the moment.
- The Altman-Z score of BAX (2.24) is better than 64.13% of its industry peers.
- The Debt to FCF ratio of BAX is 38.94, which is on the high side as it means it would take BAX, 38.94 years of fcf income to pay off all of its debts.
- BAX has a Debt to FCF ratio of 38.94. This is in the better half of the industry: BAX outperforms 67.39% of its industry peers.
- A Debt/Equity ratio of 1.21 is on the high side and indicates that BAX has dependencies on debt financing.
- The Debt to Equity ratio of BAX (1.21) is worse than 76.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 38.94 | ||
| Altman-Z | 2.24 |
ROIC/WACC0.41
WACC7.48%
2.3 Liquidity
- BAX has a Current Ratio of 1.84. This is a normal value and indicates that BAX is financially healthy and should not expect problems in meeting its short term obligations.
- With a Current ratio value of 1.84, BAX is not doing good in the industry: 65.22% of the companies in the same industry are doing better.
- BAX has a Quick Ratio of 1.18. This is a normal value and indicates that BAX is financially healthy and should not expect problems in meeting its short term obligations.
- With a Quick ratio value of 1.18, BAX is not doing good in the industry: 67.39% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.84 | ||
| Quick Ratio | 1.18 |
3. Growth
3.1 Past
- BAX shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -19.93%.
- BAX shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -4.21% yearly.
- BAX shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -21.20%.
- Measured over the past years, BAX shows a decrease in Revenue. The Revenue has been decreasing by -1.31% on average per year.
EPS 1Y (TTM)-19.93%
EPS 3Y-9.2%
EPS 5Y-4.21%
EPS Q2Q%-13.75%
Revenue 1Y (TTM)-21.2%
Revenue growth 3Y-5.95%
Revenue growth 5Y-1.31%
Sales Q2Q%-26.34%
3.2 Future
- BAX is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 1.85% yearly.
- Based on estimates for the next years, BAX will show a small growth in Revenue. The Revenue will grow by 2.77% on average per year.
EPS Next Y-11.87%
EPS Next 2Y-8.48%
EPS Next 3Y-3.29%
EPS Next 5Y1.85%
Revenue Next Year4.95%
Revenue Next 2Y3.46%
Revenue Next 3Y3.3%
Revenue Next 5Y2.77%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 8.15 indicates a reasonable valuation of BAX.
- Compared to the rest of the industry, the Price/Earnings ratio of BAX indicates a rather cheap valuation: BAX is cheaper than 96.20% of the companies listed in the same industry.
- BAX is valuated cheaply when we compare the Price/Earnings ratio to 27.25, which is the current average of the S&P500 Index.
- Based on the Price/Forward Earnings ratio of 8.66, the valuation of BAX can be described as reasonable.
- 96.20% of the companies in the same industry are more expensive than BAX, based on the Price/Forward Earnings ratio.
- BAX's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.15 | ||
| Fwd PE | 8.66 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of BAX indicates a rather cheap valuation: BAX is cheaper than 89.67% of the companies listed in the same industry.
- BAX's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. BAX is cheaper than 74.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 41.4 | ||
| EV/EBITDA | 10.65 |
4.3 Compensation for Growth
- BAX's earnings are expected to decrease with -3.29% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-8.48%
EPS Next 3Y-3.29%
5. Dividend
5.1 Amount
- BAX has a yearly dividend return of 0.20%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.20, BAX pays a better dividend. On top of this BAX pays more dividend than 90.22% of the companies listed in the same industry.
- With a Dividend Yield of 0.20, BAX pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.2% |
5.2 History
- The dividend of BAX is nicely growing with an annual growth rate of 6.89%!
- BAX has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.89%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- BAX has negative earnings and hence a negative payout ratio. The dividend may be in danger.
- BAX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP-119.65%
EPS Next 2Y-8.48%
EPS Next 3Y-3.29%
BAXTER INTERNATIONAL INC / BAX FAQ
What is the fundamental rating for BAX stock?
ChartMill assigns a fundamental rating of 4 / 10 to BAX.
Can you provide the valuation status for BAXTER INTERNATIONAL INC?
ChartMill assigns a valuation rating of 6 / 10 to BAXTER INTERNATIONAL INC (BAX). This can be considered as Fairly Valued.
What is the profitability of BAX stock?
BAXTER INTERNATIONAL INC (BAX) has a profitability rating of 4 / 10.
Can you provide the expected EPS growth for BAX stock?
The Earnings per Share (EPS) of BAXTER INTERNATIONAL INC (BAX) is expected to decline by -11.87% in the next year.
How sustainable is the dividend of BAXTER INTERNATIONAL INC (BAX) stock?
The dividend rating of BAXTER INTERNATIONAL INC (BAX) is 3 / 10 and the dividend payout ratio is -119.65%.