Baxter International (NYSE:BAX) Hits New 1-Year Low After Earnings Miss

Key Points

• Baxter International reached a new 52-week low of $22.98 after reporting weaker-than-expected earnings, with an EPS of $0.59 compared to the analyst estimate of $0.60.
• The company declared a quarterly dividend of $0.17 per share, contributing to an annualized dividend yield of 2.90% despite a negative net margin of 4.71%.
• Equities analysts have downgraded Baxter International's price targets, with ratings ranging from "sell" to "buy," reflecting mixed sentiment after the recent earnings announcement.

Baxter International Inc. (NYSE:BAX - Get Free Report) shares hit a new 52-week low during mid-day trading on Thursday following a weaker than expected earnings announcement. The company traded as low as $24.73 and last traded at $22.98, with a volume of 139193 shares trading hands. The stock had previously closed at $28.05.

The medical instruments supplier reported $0.59 EPS for the quarter, missing the consensus estimate of $0.60 by ($0.01). The firm had revenue of $2.81 billion for the quarter, compared to the consensus estimate of $2.82 billion. Baxter International had a positive return on equity of 16.93% and a negative net margin of 1.42%. Baxter International's quarterly revenue was up 4.3% compared to the same quarter last year. During the same period in the prior year, the business earned $0.68 EPS.

Baxter International Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, October 1st. Investors of record on Friday, August 29th will be given a dividend of $0.17 per share. This represents a $0.68 annualized dividend and a yield of 3.1%. The ex-dividend date is Friday, August 29th. Baxter International's dividend payout ratio (DPR) is presently -226.67%.

Analyst Ratings Changes

A number of research firms recently issued reports on BAX. The Goldman Sachs Group downgraded shares of Baxter International from a "buy" rating to a "neutral" rating and set a $25.00 price target for the company. in a research note on Friday. Wall Street Zen downgraded shares of Baxter International from a "buy" rating to a "hold" rating in a research report on Saturday. Morgan Stanley lowered their price objective on Baxter International from $28.00 to $27.00 and set an "underweight" rating on the stock in a research report on Tuesday, July 15th. Wells Fargo & Company lowered their price target on shares of Baxter International from $33.00 to $24.00 and set an "equal weight" rating on the stock in a report on Friday. Finally, Evercore ISI dropped their price target on Baxter International from $44.00 to $42.00 and set an "outperform" rating for the company in a research note on Tuesday, July 8th. One equities research analyst has rated the stock with a sell rating, five have given a hold rating and four have assigned a buy rating to the company. Based on data from MarketBeat, the stock currently has a consensus rating of "Hold" and a consensus price target of $33.13.

Institutional Investors Weigh In On Baxter International

Several large investors have recently bought and sold shares of BAX. Dodge & Cox grew its stake in Baxter International by 13.0% during the 4th quarter. Dodge & Cox now owns 50,377,294 shares of the medical instruments supplier's stock valued at $1,469,002,000 after acquiring an additional 5,779,100 shares in the last quarter. Russell Investments Group Ltd. boosted its holdings in shares of Baxter International by 40.4% during the 4th quarter. Russell Investments Group Ltd. now owns 1,745,709 shares of the medical instruments supplier's stock worth $50,904,000 after purchasing an additional 502,370 shares during the last quarter. ARGA Investment Management LP grew its position in shares of Baxter International by 52.5% in the first quarter. ARGA Investment Management LP now owns 1,327,946 shares of the medical instruments supplier's stock valued at $45,456,000 after purchasing an additional 457,345 shares in the last quarter. GAMMA Investing LLC increased its holdings in shares of Baxter International by 11,821.6% in the first quarter. GAMMA Investing LLC now owns 387,689 shares of the medical instruments supplier's stock valued at $13,271,000 after purchasing an additional 384,437 shares during the last quarter. Finally, Parkwood LLC purchased a new position in Baxter International during the fourth quarter worth approximately $10,747,000. 90.19% of the stock is currently owned by hedge funds and other institutional investors.

Baxter International Price Performance

The company has a debt-to-equity ratio of 1.33, a current ratio of 2.02 and a quick ratio of 1.40. The stock has a 50 day simple moving average of $29.52 and a two-hundred day simple moving average of $31.03. The company has a market cap of $11.27 billion, a price-to-earnings ratio of -73.23, a price-to-earnings-growth ratio of 0.65 and a beta of 0.59.

About Baxter International

Baxter International Inc, through its subsidiaries, develops and provides a portfolio of healthcare products worldwide. The company operates through four segments: Medical Products and Therapies, Healthcare Systems and Technologies, Pharmaceuticals, and Kidney Care. The company offers sterile intravenous (IV) solutions; infusion systems and devices; parenteral nutrition therapies; generic injectable pharmaceuticals; surgical hemostat and sealant products, advanced surgical equipment; smart bed systems; patient monitoring and diagnostic technologies; and respiratory health devices, as well as advanced equipment for the surgical space, including surgical video technologies, precision positioning devices, and other accessories.