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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#2372
Positioning
Market Dominance
Manufacturing
Medical Equipment
$11.7B
José E. Almeida
Baxter International Inc. develops and provides a portfolio of healthcare products worldwide. The company sells its products through direct sales force, as well as through independent distributors, drug wholesalers, and specialty pharmacy or other alternate site providers in approximately 100 countries.
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Dates updated upon official exchange announcement.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = BAX ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$UL UNILEVER PLC | 78 | 96 | 98 | 59 | - | - | 28.5% | 8.0% | 100.0% | 100.0% | 10.4% | -4.6% | 3.3% | 0.0x | $141.8B | VS | |
$ASML ASML HOLDING NV | 77 | 89 | 86 | 83 | - | - | 46.1% | 16.6% | 51.3% | 31.9% | 26.8% | -4.0% | 1.0% | 25.0x | $272.1B | VS | |
$ESLT ELBIT SYSTEMS LTD | 76 | 81 | 87 | 85 | - | - | 10.3% | 3.1% | 24.1% | 7.2% | 4.7% | 14.3% | 0.8% | 25.0x | $11.4B | VS | |
$MT ArcelorMittal | 75 | 71 | 98 | 85 | - | - | 2.2% | 1.5% | 9.3% | 5.3% | 2.2% | -8.5% | 2.2% | 16.0x | $18.9B | VS | |
$AMAT APPLIED MATERIALS INC /DE | 75 | 85 | 87 | 84 | 20.9x | 13.6x | 35.5% | 19.8% | 48.7% | 29.2% | 24.7% | 4.4% | 0.8% | 32.0x | $181.9B | VS | |
$SIMO Silicon Motion Technology CORP | 75 | 84 | 86 | 85 | - | - | 11.8% | 8.8% | 45.9% | 11.3% | 11.1% | 25.7% | 3.7% | 0.0x | $1.8B | VS | |
$CODA Coda Octopus Group, Inc. | 74 | 83 | 90 | 79 | 16.3x | 11.9x | 7.6% | 7.0% | 66.5% | 17.1% | 15.6% | 39.0% | 0.0% | 0.0x | $115M | VS | |
$GSK GSK plc | 74 | 84 | 90 | 70 | - | - | 22.6% | 4.9% | 71.2% | 12.8% | 9.4% | 1.7% | 5.9% | 124.0x | $72.1B | VS | |
$EFXT Enerflex Ltd. | 74 | 80 | 91 | 83 | - | - | 3.0% | 1.1% | 20.9% | 7.3% | 1.3% | 3.0% | 0.9% | 67.0x | $1.2B | VS | |
$BUD Anheuser-Busch InBev SA/NV | 74 | 84 | 97 | 63 | - | - | 8.2% | 3.5% | 55.3% | 25.9% | 12.4% | 0.7% | 1.7% | 0.0x | $87.0B | VS | |
$BAX BAXTER INTERNATIONAL INC | 48 | 50 | 68 | 30 | 35.3x | 24.7x | 5.2% | 1.6% | 35.0% | 5.2% | 2.9% | -25.6% | 3.0% | 155.0x | $11.7B | ||
| SECTOR BENCH | - | - | - | - | - | 22.3x | 11.5x | -2.5% | -0.1% | 42.5% | 1.3% | -0.2% | 5.9% | 0.0% | 0.2x | - | REF |
BAXTER INTERNATIONAL INC (BAX) receives a "Reduce" rating with a composite score of 47.7/100. It ranks #2372 out of 7,333 stocks in our coverage universe and carries a 2-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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YOY expansion rate
Core pricing power
Operating efficiency
Bottom-line conversion
Equity capital efficiency
Asset base utilization
Financial leverage load
Direct cash return
José E. Almeida
Chief Executive Officer
Labor Force
60,000
50
29
56
Audit Verdict: Lower quality and stability scores may indicate governance concerns.
No recent insider transactions available for BAX
Lagging peers — losers tend to keep underperforming
Trading at a discount to fundamentals — favorable entry valuation
Average quality profile
Average volatility — neutral timing signal
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Manufacturing sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for BAX.
View All RatingsMaterial decline in asset turnover efficiency detected
High margin volatility — erratic forensic earnings quality
| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 50 | 33 | +17ALPHA |
| MOMENTUM | 30 | 9 | +21ALPHA |
| VALUATION | 68 | 61 | +7ALPHA |
| INVESTMENT | 29 | 31 | -2NEUTRAL |
| STABILITY | 56 | 44 | +12ALPHA |
| SHORT INT | 36 | 26 | +10ALPHA |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROIC -3.2% vs WACC 6.4% (spread -9.5%)
GM 35% vs sector 43%, OM 5% vs sector 1%
Capital turnover 1.46x, R&D intensity 4.6%
Rev growth -26%, 10yr history
Interest coverage -1.1x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
BAXTER INTERNATIONAL INC receives a Reduce rating from our analysis, with a composite score of 47.7/100 and 2 out of 5 stars, ranking #2372 out of 7,333 stocks. BAX's factor profile shows weakness across multiple dimensions, suggesting the stock may underperform going forward. Existing holders may want to consider trimming positions or tightening stop-losses.
With a quality score of 50/100, BAX shows adequate but unremarkable business quality. The company reports a return on equity of 5.2% (sector avg: -2.5%), gross margins of 35.0% (sector avg: 42.5%), net margins of 2.9% (sector avg: -0.2%). This suggests the company generates acceptable returns but may lack the competitive positioning or operational efficiency to stand out from peers.
BAX's value score of 68/100 indicates the stock is fairly valued based on its current fundamentals. Key valuation metrics include a P/E ratio of 35.25x, an EV/EBITDA of 24.72x, a P/B ratio of 1.82x. At this level, neither a clear bargain nor overpriced, the stock's attractiveness depends more on forward growth expectations and qualitative factors.
BAXTER INTERNATIONAL INC's investment score of 29/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of -25.6% vs. a sector average of 5.9% and a return on assets of 1.6% (sector: -0.1%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
BAX is currently showing below-average momentum at 30/100, which may indicate weakening institutional interest or negative sentiment shifts. Revenue growth stands at -25.6% year-over-year, while a beta of 0.99 reflects its sensitivity to broader market moves. Investors should note that declining momentum can precede further price weakness, though contrarian opportunities sometimes emerge at these levels.
With a stability score of 56/100, BAX exhibits average financial resilience. Key stability metrics include a beta of 0.99 and a debt-to-equity ratio of 155.00x (sector avg: 0.2x). While the balance sheet is not a major concern, the stock is subject to typical market volatility and may experience sharper drawdowns during risk-off episodes.
BAXTER INTERNATIONAL INC's short interest score of 36/100 reveals significant bearish positioning, suggesting institutional investors are actively betting against the stock. Specific risk factors include elevated leverage (D/E: 155.00x). At $11.7B (large-cap), BAX carries meaningful risk and is best suited for investors with high risk tolerance who have thoroughly evaluated the bear thesis.
BAX pays a solid dividend yield of 3.0%, contributing an income component to total returns. This moderate yield suggests a balance between returning capital to shareholders and retaining earnings for reinvestment — a common profile among quality compounders.
BAXTER INTERNATIONAL INC is a large-cap company in the Manufacturing sector, ranked #0 of 50 in its sector (100th percentile) and #2372 of 7,333 overall (68th percentile). Key comparisons include ROE of 5.2% exceeding the -2.5% sector median and operating margins of 5.2% above the 1.3% sector average. This top-quartile standing reflects exceptional competitive strength relative to Manufacturing peers.
While BAX currently exhibits a REDUCE profile, superior opportunities exist within the MANUFACTURING sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Manufacturing Alpha →Quant Factor Profile
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Improvement in Investment (29) would have the largest impact on the composite score.
EV/EBITDA 116% ABOVE SECTOR MEDIAN
ROE 308% BELOW SECTOR MEDIAN
Gross Margin 18% BELOW SECTOR MEDIAN
AUDIT DATA AS OF SEP 30, 2025 (Q2 FY2025)
We rate BAXTER INTERNATIONAL INC (BAX) as a Reduce with a composite score of 47.7/100 at a current price of $20.64. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential and elevated risk of underperformance relative to peers over the next 12 months.
The rating is primarily driven by strength in value (68th percentile) and stability (56th percentile), which together account for the majority of the composite score. Offsetting weakness in investment (29th percentile) and momentum (30th percentile) tempers our overall conviction. We assign a No Moat rating (30/100), Medium uncertainty, and Poor capital allocation.
Key items to watch: momentum to confirm whether the current price trend has legs; balance sheet deleveraging progress. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.
BAXTER INTERNATIONAL INC holds a top-quartile position (#0 of 50) within the Manufacturing sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 47.7/100 places it at rank #2372 in our full 7,333-stock universe. With a $11.7B market capitalization, BAXTER INTERNATIONAL INC operates at meaningful scale within the Manufacturing sector, providing competitive advantages in distribution, procurement, and customer reach.
Revenue contraction of -26% combined with momentum at the 30th percentile paints a cautious picture of the near-term business outlook. The market appears to be pricing in continued challenges, and a catalyst for reversal is not clearly visible from current data.
The margin cascade tells an important story: gross margins of 35% (-7.5pp vs sector) narrow to operating margins of 5% (+3.9pp vs sector) and net margins of 2.9%, yielding a gross-to-net conversion rate of 8%. The significant margin erosion from gross to net suggests elevated operating expenses, high interest costs, or other structural drags that warrant monitoring.
At a current price of $20.64, BAXTER INTERNATIONAL INC is trading near fair value based on current fundamentals. Our value factor score of 68/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.
The stock currently trades at a P/E of 35.3x (a 58% premium to the sector median of 22.3x), EV/EBITDA of 24.7x (at a premium), P/B of 1.8x, P/S of 1.0x. The above-sector P/E multiple suggests the market is pricing in superior growth or quality, which our analysis finds only partially justified by current fundamentals.
A value factor score of 68/100 suggests the market is underpricing these fundamentals, creating a potential margin of safety for new investors.
A 2.99% dividend yield provides income while you wait, and dividends historically account for a significant portion of total equity returns.
The Reduce rating (composite 47.7/100) reflects multi-factor weakness, and historically, stocks in this scoring range have underperformed the market by a meaningful margin.
A P/E of 35.3x leaves little room for execution misses — any earnings disappointment could trigger a sharp multiple compression.
Elevated leverage (155% D/E) amplifies downside risk and limits management's financial flexibility in adverse scenarios.
Revenue decline of -26% signals business deterioration — declining revenues make it difficult to grow into the current valuation and often precede further negative revisions.
We assign a Medium uncertainty rating to BAXTER INTERNATIONAL INC. The stock presents a balanced risk profile: significant leverage (155% debt-to-equity) and the combination of leverage (155% D/E) and thin margins (2.9% net) amplifies downside risk. While not risk-free, the core business fundamentals are adequate to withstand moderate economic stress, and the range of potential outcomes around our fair value estimate is manageable.
Specific risk factors that inform our assessment include: significant leverage (155% debt-to-equity); the combination of leverage (155% D/E) and thin margins (2.9% net) amplifies downside risk. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 56th percentile and quality factor at the 50th percentile provide a quantitative summary of the overall risk landscape.
Key risk mitigants include: a 2.99% dividend yield anchors total return. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.
We rate BAXTER INTERNATIONAL INC's capital allocation as Poor. Key concerns include elevated leverage (155% D/E), weak asset returns (ROA 1.6%). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — BAXTER INTERNATIONAL INC significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.
Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.
In summary, BAXTER INTERNATIONAL INC receives a Reduce rating with a composite score of 47.7/100 (rank #2372 of 7,333). Our quantitative framework assigns a No Moat (30/100, trend: stable), Medium uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 47/100.
Our analysis does not support a constructive view on BAXTER INTERNATIONAL INC at this time. The combination of limited competitive advantages, medium uncertainty, and poor capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.
Analysis derived from Blank Capital Research quantitative terminal. For informational purposes only. No trade solicitation. Past performance not indicative of future results. Consult a qualified advisor.
We do not assign BAXTER INTERNATIONAL INC a meaningful economic moat, scoring 30/100 on our composite assessment. The ROIC-WACC spread of -9.5% is the primary signal of economic value creation. Current fundamentals do not demonstrate the kind of durable competitive advantages — such as superior returns on invested capital, margin superiority, or reinvestment efficiency — that would protect the company from competitive erosion over the long term. The highest-scoring pillar, margin superiority, reached only 12.1/20.
The strongest moat sources are margin superiority (12.1/20) and financial resilience (5.9/20). GM 35% vs sector 43%, OM 5% vs sector 1%. Interest coverage -1.1x. These pillars form the core of BAXTER INTERNATIONAL INC's competitive identity and are the primary drivers of excess returns in our framework.
Areas of relative weakness include economic value creation (2.4/20) and reinvestment efficiency (3.9/20). ROIC -3.2% vs WACC 6.4% (spread -9.5%). Improvement in these areas could meaningfully widen the moat over time, while deterioration would be an early warning of competitive erosion.
Our moat trend assessment is Stable. Multi-year ROIC and operating margin trajectories show neither meaningful improvement nor deterioration, suggesting the competitive position is steady. We expect BAXTER INTERNATIONAL INC's moat profile to remain largely unchanged absent a material shift in return on capital or industry dynamics.
Key profit drivers include declining revenues (-26%) that pressure the earnings outlook. The margin cascade from 35% gross to 5% operating to 2.9% net reveals the company's cost structure and reinvestment intensity. Our analysis indicates that profit quality is adequate though not exceptional, with the quality factor at the 50th percentile.
The margin profile shows gross margins of 35%, operating margins of 5%, net margins of 2.9%. Return metrics include ROE of 5.2% and ROA of 1.6%. Relative to the Manufacturing sector, gross margins are 7.5 percentage points below the sector median of 43%, and ROE of 5.2% compares to a sector median of -2.5%.
The balance sheet reflects high leverage with D/E of 155%, which may limit financial flexibility, a dividend yield of 2.99%, revenue growth of -26%. The sector median D/E is 0%, putting BAXTER INTERNATIONAL INC at higher leverage than the typical peer. Elevated leverage in combination with the current margin profile warrants close monitoring for any deterioration in debt-servicing capacity.
Thin net margins of 2.9% provide limited cushion against cost pressures, competitive pricing, or macroeconomic headwinds — even small changes in costs could swing the company to a loss.
Baxter International (NYSE:BAX) reported fourth quarter revenue growth but weaker profitability. Management cited an unfavorable sales mix, higher costs, and operational challenges as key pressure points. The company recorded significant goodwill impairments that weighed on reported earnings. CEO Andrew Hider publicly called the quarter disappointing and said performance needs meaningful improvement. Baxter International, a major medical products and therapies company, sits at the center of...
Baxter International's stock fell 15.58% after the company reported mixed Q4 2025 earnings with a revenue beat but significant earnings miss. While sales rose 8% to $2.97 billion, non-GAAP net income dropped 24% to $0.44 per share, falling short of analyst expectations of $0.54 per share. The company's 2026 guidance forecasting flat to 1% sales growth and lower adjusted earnings per share ($1.85-$2.05 vs. $2.27 in 2025) further disappointed investors.
Baxter International has cut its dividend significantly and faced a 75% stock decline over five years due to inconsistent revenue and negative earnings. However, the company's essential medical products, attractive valuation metrics, and strong demographic tailwinds from an aging population may appeal to turnaround and value investors, though recovery could be uneven and prolonged.
If you are wondering whether Baxter International's share price reflects its underlying value, this article will walk you through what the current market price might be implying. The stock last closed at US$21.26, with returns of 7.4% over 7 days, 7.2% over 30 days and 9.0% year to date, set against a 38.3% decline over 1 year, 42.8% over 3 years and 69.7% over 5 years. Recent news flow around Baxter International has focused on the company's long term repositioning and ongoing portfolio...
Kenai Therapeutics, a clinical-stage biotechnology company pioneering next generation approaches to cure neurological conditions, today announced the appointment of Blake Arnold, CFA, as Chief Business Officer. In this role, Mr. Arnold will lead Kenai's business development, financing, strategic partnerships, and corporate development initiatives to support the company's clinical and pipeline growth.
Above 50MA
37.18%
Net New Highs
+51081