BAXTER INTERNATIONAL INC (BAX) Stock Fundamental Analysis
NYSE:BAX - New York Stock Exchange, Inc. - US0718131099 - Common Stock - Currency: USD
BAX gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 187 industry peers in the Health Care Equipment & Supplies industry. While BAX is still in line with the averages on profitability rating, there are concerns on its financial health. BAX has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year BAX was profitable.
In the past year BAX had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: BAX reported negative net income in multiple years.
BAX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of -2.63%, BAX is in the better half of the industry, outperforming 69.52% of the companies in the same industry.
BAX has a better Return On Equity (-7.91%) than 68.45% of its industry peers.
BAX has a better Return On Invested Capital (3.25%) than 71.66% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for BAX is below the industry average of 7.89%.
The last Return On Invested Capital (3.25%) for BAX is above the 3 year average (3.20%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.63% | ||
| ROE | -7.91% | ||
| ROIC | 3.25% |
ROA(3y)-0.58%
ROA(5y)1.52%
ROE(3y)-6.47%
ROE(5y)1.48%
ROIC(3y)3.2%
ROIC(5y)4.54%
1.3 Margins
BAX's Operating Margin of 6.53% is fine compared to the rest of the industry. BAX outperforms 74.33% of its industry peers.
In the last couple of years the Operating Margin of BAX has declined.
BAX has a Gross Margin of 36.70%. This is in the lower half of the industry: BAX underperforms 68.45% of its industry peers.
BAX's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.53% | ||
| PM (TTM) | N/A | ||
| GM | 36.7% |
OM growth 3Y-25.59%
OM growth 5Y-17.42%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-1.94%
GM growth 5Y-2.16%
2. Health
2.1 Basic Checks
BAX has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
BAX has more shares outstanding than it did 1 year ago.
BAX has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, BAX has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.51 indicates that BAX is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of BAX (2.51) is better than 62.03% of its industry peers.
The Debt to FCF ratio of BAX is 37.17, which is on the high side as it means it would take BAX, 37.17 years of fcf income to pay off all of its debts.
BAX's Debt to FCF ratio of 37.17 is fine compared to the rest of the industry. BAX outperforms 70.59% of its industry peers.
A Debt/Equity ratio of 1.33 is on the high side and indicates that BAX has dependencies on debt financing.
With a Debt to Equity ratio value of 1.33, BAX is not doing good in the industry: 82.89% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.33 | ||
| Debt/FCF | 37.17 | ||
| Altman-Z | 2.51 |
ROIC/WACC0.61
WACC5.33%
2.3 Liquidity
A Current Ratio of 2.02 indicates that BAX has no problem at all paying its short term obligations.
The Current ratio of BAX (2.02) is worse than 64.17% of its industry peers.
BAX has a Quick Ratio of 1.40. This is a normal value and indicates that BAX is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of BAX (1.40) is worse than 63.10% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.02 | ||
| Quick Ratio | 1.4 |
3. Growth
3.1 Past
BAX shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.43%.
BAX shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -4.21% yearly.
Looking at the last year, BAX shows a very negative growth in Revenue. The Revenue has decreased by -20.17% in the last year.
BAX shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.31% yearly.
EPS 1Y (TTM)-5.43%
EPS 3Y-9.2%
EPS 5Y-4.21%
EPS Q2Q%-15.38%
Revenue 1Y (TTM)-20.17%
Revenue growth 3Y-5.95%
Revenue growth 5Y-1.31%
Sales Q2Q%-26.92%
3.2 Future
The Earnings Per Share is expected to grow by 7.38% on average over the next years.
The Revenue is expected to grow by 5.75% on average over the next years.
EPS Next Y-6.19%
EPS Next 2Y0.75%
EPS Next 3Y3.55%
EPS Next 5Y7.38%
Revenue Next Year7.77%
Revenue Next 2Y5.96%
Revenue Next 3Y5.26%
Revenue Next 5Y5.75%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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
BAX is valuated reasonably with a Price/Earnings ratio of 11.00.
95.19% of the companies in the same industry are more expensive than BAX, based on the Price/Earnings ratio.
BAX is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
BAX is valuated reasonably with a Price/Forward Earnings ratio of 10.43.
Based on the Price/Forward Earnings ratio, BAX is valued cheaper than 91.98% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, BAX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11 | ||
| Fwd PE | 10.43 |
4.2 Price Multiples
81.82% of the companies in the same industry are more expensive than BAX, based on the Enterprise Value to EBITDA ratio.
73.26% of the companies in the same industry are more expensive than BAX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 54.35 | ||
| EV/EBITDA | 13.66 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y0.75%
EPS Next 3Y3.55%
5. Dividend
5.1 Amount
BAX has a Yearly Dividend Yield of 2.19%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.77, BAX pays a better dividend. On top of this BAX pays more dividend than 97.33% of the companies listed in the same industry.
BAX's Dividend Yield is comparable with the S&P500 average which is at 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.19% |
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.
The dividend of BAX is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP-94.64%
EPS Next 2Y0.75%
EPS Next 3Y3.55%
28.7
-1 (-3.37%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners98.16%
Inst Owner Change0.04%
Ins Owners0.25%
Ins Owner Change5.52%
Market Cap14.73B
Analysts68.18
Price Target38.21 (33.14%)
Short Float %3.34%
Short Ratio4.58
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.19% |
Yearly Dividend1.16
Dividend Growth(5Y)6.89%
DP-94.64%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.72%
Min EPS beat(2)10.69%
Max EPS beat(2)12.74%
EPS beat(4)4
Avg EPS beat(4)6.75%
Min EPS beat(4)1.64%
Max EPS beat(4)12.74%
EPS beat(8)7
Avg EPS beat(8)3.03%
EPS beat(12)8
Avg EPS beat(12)2.81%
EPS beat(16)12
Avg EPS beat(16)3.89%
Revenue beat(2)2
Avg Revenue beat(2)1.19%
Min Revenue beat(2)0.46%
Max Revenue beat(2)1.93%
Revenue beat(4)3
Avg Revenue beat(4)0.49%
Min Revenue beat(4)-0.93%
Max Revenue beat(4)1.93%
Revenue beat(8)5
Avg Revenue beat(8)-0.09%
Revenue beat(12)6
Avg Revenue beat(12)-1.28%
Revenue beat(16)6
Avg Revenue beat(16)-2.32%
PT rev (1m)-1.01%
PT rev (3m)-3.91%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.11%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)1.06%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.35%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)1.55%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11 | ||
| Fwd PE | 10.43 | ||
| P/S | 1.24 | ||
| P/FCF | 54.35 | ||
| P/OCF | 22.21 | ||
| P/B | 2.08 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.66 |
EPS(TTM)2.61
EY9.09%
EPS(NY)2.75
Fwd EY9.58%
FCF(TTM)0.53
FCFY1.84%
OCF(TTM)1.29
OCFY4.5%
SpS23.17
BVpS13.8
TBVpS-6.5
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.63% | ||
| ROE | -7.91% | ||
| ROCE | 4.35% | ||
| ROIC | 3.25% | ||
| ROICexc | 3.73% | ||
| ROICexgc | 11.33% | ||
| OM | 6.53% | ||
| PM (TTM) | N/A | ||
| GM | 36.7% | ||
| FCFM | 2.28% |
ROA(3y)-0.58%
ROA(5y)1.52%
ROE(3y)-6.47%
ROE(5y)1.48%
ROIC(3y)3.2%
ROIC(5y)4.54%
ROICexc(3y)3.57%
ROICexc(5y)5.33%
ROICexgc(3y)9.57%
ROICexgc(5y)12.38%
ROCE(3y)4.43%
ROCE(5y)6.16%
ROICexcg growth 3Y-30.34%
ROICexcg growth 5Y-21.96%
ROICexc growth 3Y-22.52%
ROICexc growth 5Y-26.32%
OM growth 3Y-25.59%
OM growth 5Y-17.42%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-1.94%
GM growth 5Y-2.16%
F-Score5
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.33 | ||
| Debt/FCF | 37.17 | ||
| Debt/EBITDA | 5.59 | ||
| Cap/Depr | 43.12% | ||
| Cap/Sales | 3.3% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 39.35% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.02 | ||
| Quick Ratio | 1.4 | ||
| Altman-Z | 2.51 |
F-Score5
WACC5.33%
ROIC/WACC0.61
Cap/Depr(3y)49.31%
Cap/Depr(5y)63.51%
Cap/Sales(3y)5.12%
Cap/Sales(5y)5.45%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.43%
EPS 3Y-9.2%
EPS 5Y-4.21%
EPS Q2Q%-15.38%
EPS Next Y-6.19%
EPS Next 2Y0.75%
EPS Next 3Y3.55%
EPS Next 5Y7.38%
Revenue 1Y (TTM)-20.17%
Revenue growth 3Y-5.95%
Revenue growth 5Y-1.31%
Sales Q2Q%-26.92%
Revenue Next Year7.77%
Revenue Next 2Y5.96%
Revenue Next 3Y5.26%
Revenue Next 5Y5.75%
EBIT growth 1Y-37.62%
EBIT growth 3Y-30.01%
EBIT growth 5Y-18.5%
EBIT Next Year78.77%
EBIT Next 3Y25.02%
EBIT Next 5Y21.63%
FCF growth 1Y-64.85%
FCF growth 3Y-27.1%
FCF growth 5Y-16.46%
OCF growth 1Y-55.26%
OCF growth 3Y-22.88%
OCF growth 5Y-13.5%