Baxter International Inc

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BAX : NYSE : Health Care
$46.68 up 0.16 | 0.34%
Today's Range: 46.39 - 46.97
Avg. Daily Volume: 3972300.0
01/18/17 - 12:28 PM ET

Financial Analysis


BAXTER INTERNATIONAL INC's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. BAXTER INTERNATIONAL INC has strong liquidity. Currently, the Quick Ratio is 1.66 which shows the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has increased by 10.90% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)2558.02487.0
EBITDA ($mil)571.0455.0
EBIT ($mil)367.0239.0
Net Income ($mil)130.01.0


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)2597.01970.0
Total Assets ($mil)15795.020172.0
Total Debt ($mil)2840.06729.0
Equity ($mil)8677.07824.0


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin51.2550.86
EBITDA Margin22.3218.29
Operating Margin14.359.61
Sales Turnover0.640.5
Return on Assets31.198.5
Return on Equity56.574.3
Debt Q3 FY16 Q3 FY15
Current Ratio2.531.86
Debt/Capital0.250.46
Interest Expense20.038.0
Interest Coverage18.356.29


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)543.91546.82
Div / share0.130.12
EPS0.230.0
Book value / share15.9514.31
Institutional Own % n/a n/a
Avg Daily Volume4023394.03801337.0

Valuation


BUY. BAXTER INTERNATIONAL INC's P/E ratio indicates a significant discount compared to an average of 69.11 for the Health Care Equipment & Supplies industry and a significant discount compared to the S&P 500 average of 25.49. To use another comparison, its price-to-book ratio of 2.92 indicates valuation on par with the S&P 500 average of 2.84 and a significant discount versus the industry average of 8.30. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, BAXTER INTERNATIONAL INC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
BAX 5.24 Peers 69.11   BAX 15.25 Peers 23.72

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

BAX is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

BAX is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
BAX 21.63 Peers 23.81   BAX 0.03 Peers 1.00

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

BAX is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

BAX trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
BAX 2.92 Peers 8.30   BAX 1380.00 Peers 84.51

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

BAX is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

BAX is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
BAX 2.50 Peers 5.77   BAX -0.33 Peers 17.12

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

BAX is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

BAX significantly trails its peers on the basis of sales growth

 

 

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