Is Now The Time To Buy Baxter Stock?

CANADA – 2025/05/01: In this photo illustration, the Baxter International logo is seen displayed on a smartphone screen. (Photo Illustration by Thomas Fuller/SOPA Images/LightRocket via Getty Images)

SOPA Images/LightRocket via Getty Images

Baxter stock (NYSE: BAX), a healthcare company, has seen its stock decline by 14% over the past month. This drop followed a disappointing earnings report where the company also reduced its full-year guidance, partly due to Hurricane Helene impacting one of its manufacturing facilities. This raises the question: Is Baxter stock appealing at its current price of about $25?

Although the company is dealing with clear challenges, our analysis suggests the stock’s current valuation already reflects these headwinds. We reached this conclusion by comparing Baxter’s valuation against its recent operating performance and historical financial position. Our review—focusing on Growth, Profitability, Financial Stability, and Downturn Resilience—shows weak operating performance and financial health. However, these concerns appear to be factored into the market price.

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How Does Baxter International’s Valuation Compare to The S&P 500?

Looking at valuation per dollar of sales or profit, BAX stock appears inexpensive relative to the broader market.

• Baxter International has a price-to-sales (P/S) ratio of 1.2 compared to 3.3 for the S&P 500

How Have Baxter International’s Revenues Trended?

Baxter International’s Revenues have declined in recent years.

• Baxter’s top line contracted at an average of 5.7% over the last three years (vs. +5.3% for the S&P 500)
• Revenues rose 3.6% from $11 Bil to $11 Bil in the last 12 months (vs. +5.2% for the S&P 500)
• Quarterly revenues grew 4.3% to $2.8 Bil in the latest quarter from $2.7 Bil a year earlier (vs. +6.1% for the S&P 500)

How Profitable Is Baxter International?

Baxter International’s margins lag far behind most peers in Trefis coverage.

Is Baxter International Financially Sound?

Baxter International’s balance sheet looks adequate.

• Debt stood at $9.7 Bil at the end of the latest quarter, versus a $13 Bil market cap (as of 8/25/2025). That implies a moderate Debt-to-Equity Ratio of 77.2% (vs. 20.2% for the S&P 500). [Note: Low ratio is preferable]
• Cash (and equivalents) was $1.7 Bil of $21 Bil in Total Assets, giving a moderate Cash-to-Assets Ratio of 8.0%(vs. 7.0% for the S&P 500)

How Has BAX Stock Fared in Downturns?

BAX stock has performed slightly better than the S&P 500 in some recent downturns. Concerned about crash risks? See our dashboard – BAX Down 15% In A Month. How Confident Are You In The Stock? – for detailed performance analysis during and after prior market crashes.

Inflation Shock (2022)

• BAX fell 64.6% from $89.45 (Feb 9, 2022) to $31.71 (Oct 12, 2023), vs. a 25.4% drop for the S&P 500
• The stock has yet to reclaim its pre-crisis high
• The highest since has been $43.77 on Mar 10, 2024, with shares now at ~$25

COVID-19 Pandemic (2020)

• BAX dropped 23.3% from $93.30 (Feb 6, 2020) to $71.57 (Mar 16, 2020), vs. a 33.9% fall for the S&P 500
• The stock fully recovered by Apr 20, 2020

Global Financial Crisis (2008)

• BAX lost 34.8% from $38.69 (Aug 8, 2008) to $25.24 (Jun 10, 2009), vs. -56.8% for the S&P 500
• The stock fully recovered by Mar 26, 2013

Overall Takeaway: What It Means for BAX Stock

In summary, Baxter International’s metrics show:

• Growth: Inconsistent
• Profitability: Very Weak
• Financial Stability: Moderate
• Downturn Resilience: Moderate
• Overall: Weak

Although performance is weak, valuation appears to price in these concerns. At 1.3x trailing revenue—well below its five-year average of 2.6x—the stock looks inexpensive. Still, its erratic revenue growth and poor margins remain problematic.

Analysts’ average price target is $30, suggesting ~20% upside. Yet, we believe stronger opportunities exist. For instance, see our analysis on UNH Stock To $600, 50% Upside For LLY Stock, and Should You Buy Abbott Stock within medical devices.

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