BAXTER INTERNATIONAL INC (BAX) Stock Fundamental Analysis
NYSE:BAX - New York Stock Exchange, Inc. - US0718131099 - Common Stock - Currency: USD
Taking everything into account, BAX scores 4 out of 10 in our fundamental rating. BAX was compared to 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 is valued correctly, 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.
The reported net income has been mixed in the past 5 years: BAX reported negative net income in multiple years.
In the past 5 years BAX always reported a positive cash flow from operatings.
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.
The Return On Equity of BAX (-7.91%) is better than 68.45% of its industry peers.
BAX's Return On Invested Capital of 3.25% is fine compared to the rest of the industry. BAX outperforms 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 3 year average ROIC (3.20%) for BAX is below the current ROIC(3.25%), indicating increased profibility in the last year.
| 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
The Operating Margin of BAX (6.53%) is better than 74.33% of its industry peers.
BAX's Operating Margin has declined in the last couple of years.
BAX has a worse Gross Margin (36.70%) than 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.
BAX has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.53 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 (2.53) than 62.57% 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.
Looking at the Debt to FCF ratio, with a value of 37.17, BAX is in the better half of the industry, outperforming 70.59% of the companies in the same industry.
A Debt/Equity ratio of 1.33 is on the high side and indicates that BAX has dependencies on debt financing.
BAX has a Debt to Equity ratio of 1.33. This is amonst the worse of the industry: BAX underperforms 82.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.33 | ||
| Debt/FCF | 37.17 | ||
| Altman-Z | 2.53 |
ROIC/WACC0.6
WACC5.44%
2.3 Liquidity
BAX has a Current Ratio of 2.02. This indicates that BAX is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.02, BAX is doing worse than 64.17% of the companies in the same industry.
A Quick Ratio of 1.40 indicates that BAX should not have too much problems paying 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%.
The Earnings Per Share has been decreasing by -4.21% on average over the past years.
The Revenue for BAX has decreased by -20.17% in the past year. This is quite bad
The Revenue has been decreasing by -1.31% on average over the past years.
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.
Based on estimates for the next years, BAX will show a small growth in Revenue. The Revenue will grow by 5.75% on average per year.
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
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 11.75, which indicates a very decent valuation of BAX.
94.12% of the companies in the same industry are more expensive than BAX, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of BAX to the average of the S&P500 Index (27.30), we can say BAX is valued rather cheaply.
With a Price/Forward Earnings ratio of 11.15, the valuation of BAX can be described as very reasonable.
89.30% of the companies in the same industry are more expensive than BAX, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of BAX to the average of the S&P500 Index (21.76), we can say BAX is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.75 | ||
| Fwd PE | 11.15 |
4.2 Price Multiples
BAX's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. BAX is cheaper than 80.21% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of BAX indicates a somewhat cheap valuation: BAX is cheaper than 72.73% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 58.06 | ||
| EV/EBITDA | 13.95 |
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.
BAX's Dividend Yield is rather good when compared to the industry average which is at 1.77. BAX pays more dividend than 97.33% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.37, BAX has a dividend comparable with the average S&P500 company.
| 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
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 around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP-94.64%
EPS Next 2Y0.75%
EPS Next 3Y3.55%
30.66
+0.97 (+3.27%)
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 Cap15.73B
Analysts68.18
Price Target38.21 (24.62%)
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 | 11.75 | ||
| Fwd PE | 11.15 | ||
| P/S | 1.32 | ||
| P/FCF | 58.06 | ||
| P/OCF | 23.73 | ||
| P/B | 2.22 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.95 |
EPS(TTM)2.61
EY8.51%
EPS(NY)2.75
Fwd EY8.97%
FCF(TTM)0.53
FCFY1.72%
OCF(TTM)1.29
OCFY4.21%
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 | 2.53 |
F-Score5
WACC5.44%
ROIC/WACC0.6
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%