Skip to main content

NEW YORK (TheStreet) -- Baxter International (BAX) - Get Free Report shares are up 1.57% to $71.78 after the company provided an update for the early stage trial results for its gene treatment hemophilia B treatment candidate.

Patients participating in the Phase 1/2 trials have experienced no bleeding episodes and have gone without regular infusions, though one of the two patients treated with the highest dose of the drug did need an infusion after having a negative immune response.

Earlier this month Baxter's board approved the planned separation of the company's biopharmaceutical business into an entity known as Baxalta.

Baxter will retain a 19.5% stake in Baxalta following the spin off which is scheduled to be completed by July 1 with Baxalta trading under the symbol 'BXLT' on the New York Stock Exchange.

TheStreet Ratings team rates BAXTER INTERNATIONAL INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate BAXTER INTERNATIONAL INC (BAX) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its notable return on equity, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, generally higher debt management risk and weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Health Care Equipment & Supplies industry and the overall market, BAXTER INTERNATIONAL INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • The gross profit margin for BAXTER INTERNATIONAL INC is rather high; currently it is at 54.25%. Regardless of BAX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, BAX's net profit margin of 11.42% compares favorably to the industry average.
  • The debt-to-equity ratio of 1.38 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, BAX maintains a poor quick ratio of 0.84, which illustrates the inability to avoid short-term cash problems.
  • Net operating cash flow has significantly decreased to $96.00 million or 82.82% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • You can view the full analysis from the report here: BAX Ratings Report