November 23, 2023
Top 10 Stock Baxter Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Baxter – Top 10 Stock in Energy Efficency Leaders
Baxter is listed as a top 10 stock on November 23, 2023 in the market index Energy Efficient because of its high performance in at least one of the Obermatt investment strategies. While only half of the consolidated Obermatt Ranks exhibit above-average performance, the professional market sentiment is positive and it may be a solid investment proposition, especially if a growth recovery is to be expected soon. Based on the Obermatt 360° View of 73 (high 73% performer), Obermatt assesses an overall buy recommendation for Baxter on November 23, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Health Care Equipment |
| Index | Dividends USA, Energy Efficient, Diversity USA, Low Waste, Recycling, SDG 12, SDG 3, SDG 6, D.J. US Medical, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Baxter Buy
| 360 METRICS | November 23, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 98 |
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| GROWTH | ||||||||
| GROWTH | 9 |
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| SAFETY | ||||||||
| SAFETY | 44 |
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| SENTIMENT | ||||||||
| SENTIMENT | 79 |
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| 360° VIEW | ||||||||
| 360° VIEW | 73 |
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ANALYSIS: With an Obermatt 360° View of 73 (better than 73% compared with alternatives), overall professional sentiment and financial characteristics for the stock Baxter are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Baxter. The consolidated Value Rank has an attractive rank of 98, which means that the share price of Baxter is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 98% of alternative stocks in the same industry. The consolidated Sentiment Rank has a good rank of 79, which means that professional investors are more optimistic about the stock than for 79% of alternative investment opportunities. But the consolidated Growth Rank has a low rank of 9, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. The consolidated Safety Rank has a riskier rank of 44, meaning the company has a riskier financing structure than 56 comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 73, Baxter is better positioned than 73% of all alternative stock investment opportunities based on the Obermatt Method. Half of the consolidated Obermatt Ranks exhibit above-average performance, but the other half are below market levels. The company enjoys a good value (Value Rank of 98) and positive market sentiment in the professional investor community (Sentiment Rank of 79), but growth expectations are below-average (Growth Rank of 9) and the financing structure is on the risky side(Safety Rank of 44). This combination is rather dangerous, because high debt levels (low safety) require growth to finance the debt burden. The current low growth level may be temporary, because professionals are actually optimistic (positive sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. Companies with less growth typically have a lower price than fast-growing competitors. Even though professional investor sentiment is strong, we recommend further evaluating whether the future of Baxter is as challenging as the stock's low price suggests. Since the professional community is optimistic, the stock might just be going through a more challenging phase now, indicating that timing might be good now. ...read more
Sentiment Strategy: Professional Market Sentiment for Baxter very positive
ANALYSIS: With an Obermatt Sentiment Rank of 79 (better than 79% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Baxter is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Baxter. Analyst Opinions are at a rank of 8 (worse than 92% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 82, which indicates a shift in stock research experts opinions for the better. In other words, they are getting more optimistic about stock investments in Baxter. Even better, the Professional Investors rank is 94, meaning that professional investors hold more stock in this company than in 94% of alternative investment opportunities. Pros tend to favor investing in this company. Furthermore, Market Pulse has a rank of 80, which means that the current professional news and professional social networks are upbeat when discussing this company (more positive news than for 80% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 79 (more positive than 79% compared with investment alternatives), Baxter has a reputation among professional investors that is significantly higher than that of its competitors. While analysts are still critical of the company, some are changing their minds. In addition, the professional news channels are optimistic, and many institutional investors have already bought stock in the company. These are encouraging signals, despite the still lower level of analyst recommendations. They may be due to a problematic past, and about to change. The positive sentiment signals are stronger than the negative. ...read more
Value Strategy: Baxter Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 98 (better than 98% compared with alternatives) for 2023, Baxter shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Baxter. Price-to-Sales (P/S) is 74, which means that the stock price compared with what market professionals expect for future sales is lower than for 74% of comparable companies, indicating a good value concerning Baxter's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 68% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 98 (dividends are expected to be higher than 98% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 59% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Baxter to 41. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 98, is a buy recommendation based on Baxter's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Baxter Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 9 (better than 9% compared with alternatives), Baxter shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Baxter. Only Capital Growth has a good rank of 58, which means that currently professionals expect the company to grow its invested capital more than 21% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 27 which means that currently professionals expect the company to grow less than 73% of its competitors. Profit Growth with a rank of 21 and Stock Returns with a rank of 31 are also low (below 69% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 9, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Baxter is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Baxter Debt Financing Safety below-average
| SAFETY METRICS | November 23, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 13 |
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| REFINANCING | ||||||||
| REFINANCING | 71 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 60 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 44 |
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ANALYSIS: With an Obermatt Safety Rank of 44 (better than 44% compared with alternatives), the company Baxter has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Baxter is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Baxter. Refinancing is at 71, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 71% of its competitors. Liquidity is also good at 60, meaning the company generates more profit to service its debt than 60% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 13, which means the company has an above-average debt-to-equity ratio. It has more debt than 87% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 44 (worse than 56% compared with alternatives), Baxter has a financing structure that is riskier than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Baxter could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: Baxter Below-Average Financial Performance
| COMBINED PERFORMANCE | November 23, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 98 |
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| GROWTH | ||||||||
| GROWTH | 9 |
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| SAFETY | ||||||||
| SAFETY | 60 |
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| COMBINED | ||||||||
| COMBINED | 49 |
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ANALYSIS: With an Obermatt Combined Rank of 49 (worse than 51% compared with investment alternatives), Baxter (Health Care Equipment, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Baxter are a good value (attractively priced) with a consolidated Value Rank of 98 (better than 98% of alternatives) but show below-average growth (Growth Rank of 9), and are riskily financed (Safety Rank of 44), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 49, is a hold recommendation based on Baxter's financial characteristics. As the company Baxter's key financial metrics exhibit good value (Obermatt Value Rank of 98) but low growth (Obermatt Growth Rank of 9) and risky financing practices (Obermatt Safety Rank of 44), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 98% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
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