Analysts have reduced their price target for Baxter International from approximately $28 to $24.07 per share. They cite persistent revenue headwinds, lower margins, and management's more cautious outlook for 2025 and beyond.

Analyst Commentary

Recent analyst activity reflects both positive and negative perspectives regarding Baxter International's outlook and valuation. Expertise varies on the company's ability to execute through operational headwinds and deliver on growth targets in the coming years.

Bullish Takeaways

• Lower research and development as well as SG&A spending are expected to partially offset declining gross margins. This may help to mitigate some profit pressures in the near term.
• Despite headwinds, the company continues to generate substantial revenues across its segments and maintains its position as a significant industry player.
• Guidance for organic growth and earnings per share, while reduced, still implies continued profitability and the potential for stabilization if short-term issues are resolved.

Bearish Takeaways

• Analysts note that total sales results fell below both company guidance and consensus estimates, with shortfalls in all business segments. This points to broad-based operational challenges.
• Gross margins declined sharply, primarily due to manufacturing variances that are now expected to persist at least into 2026.
• Management's reduction of long-term guidance and more conservative forecasts reflect limited visibility into a meaningful recovery. Earnings headwinds are anticipated to outweigh potential tailwinds for the foreseeable future.
• Ongoing business pressures and leadership changes have contributed to cautious sentiment about execution and the company’s ability to rebound in the mid-term.

What's in the News

• Baxter International updated earnings guidance, now projecting fourth quarter 2025 sales growth of approximately 2% on a reported basis and a decline of about 2% on an operational basis. For the full year 2025, the company expects reported sales growth of 4% to 5% and operational growth of 1% to 2%. (Corporate Guidance)
• A securities class action lawsuit has been filed against Baxter, alleging investors were misled about safety concerns and device malfunctions related to the Novum LVP infusion pump. Reports of injuries and patient deaths led to halted shipments and a subsequent 22.4% decline in stock price. (Lawsuits & Legal Issues)
• Baxter launched the Welch Allyn Connex 360 Vital Signs Monitor, featuring enhanced security, customizable protocols, and streamlined upgrade capabilities. The device received FDA clearance and is now available for hospitals in the U.S. (Product-Related Announcements)
• The company introduced a newly designed Hemopatch sealing hemostat, developed through collaboration with surgeons to improve hemostasis in surgical procedures. (Product-Related Announcements)
• Baxter reported that from April to June 2025, no additional shares were repurchased, completing the previously announced share buyback that totaled over 103 million shares. (Buyback Tranche Update)

Valuation Changes

• Consensus Analyst Price Target has fallen significantly, dropping from $28.00 per share to $24.07 per share.
• Discount Rate has risen slightly from 9.17% to 9.73%, reflecting a modest increase in perceived risk.
• Revenue Growth expectations have been reduced considerably, declining from 3.65% to 1.75%.
• Net Profit Margin has edged lower, from 6.91% to 6.57%.
• Future Price-to-Earnings (P/E) ratio has decreased modestly, moving from 22.70x to 21.85x.