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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Baxter International Inc. (XNYS:BAX) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
BAX
Name:
BAXTER INTERNATIONAL INC. (XNYS:BAX)
Sector:
68.00M
Industry:
Medical Instruments & Supplies
CEO:
Mr. Jose Almeida
Total Employees:
60,000
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -5448.21% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF BAXTER INTERNATIONAL INC.(BAX) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND MEDICAL INSTRUMENTS & SUPPLIES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
56.21
One Month Price Target:
$56.4
Six Month Price Target :
$57.35
Likely Price in One Year's Time:
Ticker:
$58.49
Likely Trading Range Today Under (Normal Volatility)
$56.01
Price Upper limit ($) :
$56.36
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$54.1
This week:
$51.48
This month :
$46.76
Other Primary facts
Market Cap:
27.53B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
503.61M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
12.49%
-11.63%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$66.03
$61.62
$46.39
$50.80
Medium risk (<10%) entry points
Buy Call
Sell Call
$60.18
Buy Put:
Sell Put:
$59.24
$52.22
$53.18
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
BAX
Sharpe Ratio:
-2.71%
Comparison:
BAX, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -269.19% lower than the industry
& is -218.85% lower than the market/S&P 500 average
Average Returns/Yield of
BAX
Daily returns:
-0.04%
Weekly returns:
-0.20%
Monthly returns:
-0.80%
Yearly returns:
14.68%
Comparison of returns:
Average annual returns/yield (last 3 years) is -165.76% below industry average
Classification:
BAX, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.05
Statistical test of Returns:
BAX has yielded a lower return than the market, the results are statistically significant
Volatility (measured by Standard Deviation)
Daily Volatility:
1.81%
Weekly Volatility:
4.05%
Monthly Volatility:
8.10%
Yearly Volatility:
28.07%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.39%
Volatility in last five trading days has been -23.38% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-3.76%
Weekly VaR:
-8.41%
Monthly VaR:
-16.82%
How Much Can the price of
BAX
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-15%
Worst case (decline):
-58.27%
This translates to price declining to:
$47.59
This translates to price declining to:
$23.46
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
BAX is a 18.72% riskier investment compared to the market/S&P 500 & is 1.70% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -37.59% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
BAX
Beta in relation to market/S&P 500--0.60
Expected beta in 1 year's time:
0.6
Expected beta in 3 year's time:
0.849
Unlevered (debt free) Beta:
0.226
Beta in relation to Nasdaq (XNAS):
0.449
Beta in relation to all global stocks::
0.598
Beta Comparison & Analysis
Beta of competitors/peers::
0.838
Beta is -28.03% lower than peers
Average Industry Beta:
0.989
Beta is -39.03% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
7.81%
Sustainable growth rate is -46.88% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.169
Alpha is -456.13% below industry average alpha yield
Alpha is -1078% below the market average
Analysis of Cost of Capital of
BAX
Equity cost of capital:
0.073
Equity cost of capital is -26.64% below industry mean WACC
Unlevered (without debt) cost of capital:
2.73%
Before-tax cost of debt:
1.45%
After-tax cost of debt:
1.15%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.15%
WACC is -54.52% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$26.90
Revenue growth rate per share of (3Y):
3.1
Annual revenue growth rate is -59.74% below industry average
EPS:
$2.09
Expected Annual growth rate of EPS (3Y):
8.70%
Expected future EPS growth rate is -24.79% lower than the Medical Instruments & Supplies industry
Free cash flow (FCF) per share:
$2.63
Balance sheet equity growth per share: 47.88%
Equity growth rate per share is 18392.22% higher than the industry
Debt per share
$34.30
EBITDA per share
$5.00
Valuation Analysis Today of
BAX
P/E Ratio:
28.16
P/E Ratio of Competitors/Peers:
41.72
P/E ratio is -32.50% lower than main peers & is -43.56% lower than the industry
Stock price/value with industry average P/E ratio: $104.27
BAX is -46.09% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $57.00
Present value of the expected future dividends only: $26.66
P/S (Price to Sales ratio):
2.09
Price to sales ratio is -71.82% below the industry mean
P/B (Price to book value ratio):
3.1
Price to free cash flow: 21.41
-
Net income growth rate (3Y):
-17.05%
Net income growth rate is -83.86% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 13.25%
Dividend yeild: 2.01%
Previous Dividend: $0.29
Previous adjusted dividend: $0.29
Previous Dividend: $1.13
Expected next dividend best case: $0.31
Expected next dividend worst case: $0.27
Average dividend payment (long-term): $0.26
Average dividend increase/decrease (growth rate) % per period: 2.92%
Expected next dividend payment date: 29/09/2022
Expected next dividend record date: 09/01/2022
-
Previous dividend payment date: 07/01/2022
Previous dividend record date: 06/03/2022
-
Dividend History:
2022-06-02--$0.29
2021-12-02--$0.28
2021-06-03--$0.28
2022-02-24--$0.28
2021-09-02--$0.28
2021-02-25--$0.25
Dividend growth rate is -247.82% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
190.34%
Net debt to equity ratio:
169.56%
Debt to assets ratio:
52.80%
Net debt to assets ratio:
47.04%
Debt-to-asset ratio is 47.09% above industry average
Ability to repay debt:
Interest coverage ratio:
9.8
Interest coverage ratio is -86.18% less than industry average
Looking forward:
Debt growth rate:
169.11%
Annual debt growth is 54% higher than industry average debt growth rate
Debt repayment rate in last quarter: 2.53%
Analysis of Key Statistics
Correlation of price movement with the market:
0.547
Statistical significance of correlation:
BAX has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.505
Stock price is 8.29% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.505
Correlation of price movement with Nasdaq (^IXIC):
0.011
Covariance of price movement with the market:
0.012
Kurtosis
9.747
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.368
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
BAX
Gross Profit Margin Ratio:
157%
Operating Profit Margin Ratio:
10.95%
Operating profit margin is -18.21% lower than the industry
Net Profit Margin Ratio:
157%
Effective Tax Rate:
12.46%
Effective tax rate is -62.09% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
11.65%
Return on equity (ROE) is -125.54% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.23%
Return on assets (ROA) is -54.89% lower than the industry
Financial Leverage:
2.1x
Current Ratio:
2.1
Current ratio is -42.46% below industry average
Cash Conversion Cycle (days):
44.6
Cash conversion cycle is -15.43% below industry average
The remaining useful life of property plant & equipment is: 12.9 years
Stock based compensation to net income ratio:
3.03%
In-depth Efficiency Analysis
Revenue generated per employee:
225.8K
Each employee generates -36% less revenue than industry average revenue per employee
EBITDA generated per employee:
42.0K
Each employee generates -62% less EBITDA than industry average revenue per employee
Profit generated per employee:
17.6K
Each employee generates -77% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
1.1K
Each employee generates -120% less free cash flow than industry average revenue per employee
Assets/Capital per employee
409.1K
Each employee generates -120% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 2.50%
Growth rate in R&D investment/expenditure is 863.68% higher than the industry
Competitors/Peer firms of
BAX
AGILENT TECHNOLOGIES, INC. (XNYS:A)
Takeda Pharmaceutical Company Limited (XNYS:TAK)
CENTENE CORPORATION (XNYS:CNC)
Alcon Inc. (XNYS:ALC)
IQVIA HOLDINGS INC (XNYS:IQV)
MCKESSON CORPORATION (XNYS:MCK)
VEEVA SYSTEMS INC. (XNYS:VEEV)
METTLER-TOLEDO INTERNATIONAL INC. (XNYS:MTD)
RESMED INC. (XNYS:RMD)
Current Analyst Ratings
Strong buy�8%
Buy�17%
Hold�38%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
13.55B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
8.24B
5.31B
556.00M
678.00M
3.31B
-
-
3.86B
14.00M
257.00M
1.05B
2.52B
1.48B
1.06B
1.22B
152.00M
1.06B
Statement of Cash Flow
Date:
Period:
380.00M
Differed Income Tax :
- 55000.00K
Stock Based Compensation :
32.00M
Change in Working Capital :
- 224000.00K
Accounts Receivables:
153.00M
Other Working Capital:
- 43000.00K
Other Non-Cash Items:
2.00M
Net Cash Provided by Operating Activities:
208.00M
Investments in PP&E:
-
Net Acquisitions:
- 174000.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
2.29B
-
2.29B
2.47B
2.55B
860.00M
8.17B
5.72B
9.82B
7.69B
-
-
1.31B
24.54B
-
32.72B
1.22B
409.00M
-
-
2.26B
3.89B
17.27B
2.43B
19.71B
-
23.60B
683.00M
16.99B
- 3387000.0K
-
March 31, 2022 at 6:00:00 AM
12.10B
9.08B
32.67B
-
17.68B
15.4B
-
- 130000.00K
- 304000.00K
- 449000.00K
-
-
- 140000.00K
41.00M
- 548000.00K
- 13000.00K
- 657000.00K
2.30B
2.96B
208.00M
- 140000.00K
68.00M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
BAX
2023
2024
2025
2026
2027
$58.78
$79.33
$82.55
$85.89
$89.38