BAXTER INTERNATIONAL INC (BAX) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:BAX - US0718131099 - Common Stock
19.84 USD
-0.23 (-1.15%)
19.8 USD
-0.04 (-0.2%)
BAX gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals 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 on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
- In the past year BAX was profitable.
- BAX had a positive operating cash flow in the past year.
- The reported net income has been mixed in the past 5 years: BAX reported negative net income in multiple years.
- Each year in the past 5 years BAX had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of BAX (-1.62%) is better than 70.65% of its industry peers.
- The Return On Equity of BAX (-4.71%) is better than 71.20% of its industry peers.
- The Return On Invested Capital of BAX (3.04%) is better than 70.65% of its industry peers.
- BAX had an Average Return On Invested Capital over the past 3 years of 3.50%. This is significantly below the industry average of 8.84%.
| 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
- BAX has a Operating Margin of 6.37%. This is in the better half of the industry: BAX outperforms 71.74% of its industry peers.
- 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.
- In the last couple of years the Gross Margin of BAX has declined.
| 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
- The number of shares outstanding for BAX has been increased compared to 5 years ago.
- Compared to 1 year ago, BAX has a worse debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 2.24 indicates that BAX is not a great score, but indicates only limited risk for bankruptcy at the moment.
- BAX has a better Altman-Z score (2.24) 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.
- Looking at the Debt to FCF ratio, with a value of 38.94, BAX is in the better half of the industry, outperforming 67.39% of the companies in the same industry.
- BAX has a Debt/Equity ratio of 1.21. This is a high value indicating a heavy dependency on external 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
WACC7.49%
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.
- The Current ratio of BAX (1.84) is worse than 65.22% of its industry peers.
- 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.
- Looking at the Quick ratio, with a value of 1.18, BAX is doing worse than 67.39% of the companies in the same industry.
| 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.
- Looking at the last year, BAX shows a very negative growth in Revenue. The Revenue has decreased by -21.20% 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)-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.
- The Revenue is expected to grow by 2.77% on average over the next years.
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
- 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
- Based on the Price/Earnings ratio of 8.23, the valuation of BAX can be described as reasonable.
- 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's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.21.
- BAX is valuated reasonably with a Price/Forward Earnings ratio of 8.74.
- Based on the Price/Forward Earnings ratio, BAX is valued cheaper than 96.20% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of BAX to the average of the S&P500 Index (25.98), we can say BAX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.23 | ||
| Fwd PE | 8.74 |
4.2 Price Multiples
- 89.67% of the companies in the same industry are more expensive than BAX, based on the Enterprise Value to EBITDA ratio.
- Based on the Price/Free Cash Flow ratio, BAX is valued a bit cheaper than 74.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 41.8 | ||
| 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
- With a yearly dividend of 0.20%, BAX is not a good candidate for dividend investing.
- BAX's Dividend Yield is rather good when compared to the industry average which is at 0.20. BAX pays more dividend than 90.22% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.81, BAX's dividend is way lower than the S&P500 average.
| 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 been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)6.89%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- The earnings of BAX are negative and hence is the payout ratio. BAX will probably not be able to sustain this dividend level.
- 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%.