Baxter International (BAX): Assessing Valuation Following Lawsuits and Safety Concerns Around Novum IQ Pump

Baxter International (BAX) has landed in the spotlight after a series of class action lawsuits and regulatory scrutiny linked to safety concerns with its Novum IQ Large Volume Pump. Investor sentiment has been hit as the company faces headwinds from both legal action and recent operational setbacks.

See our latest analysis for Baxter International.

Baxter's recent legal and operational troubles have clearly hammered investor confidence, with the stock suffering a 1-year total shareholder return of -49.16% and a year-to-date share price return of -38.65%. Despite a modest uptick in revenue, the sustained legal overhang and a string of negative headlines have kept momentum firmly on the back foot. This has left the five-year total shareholder return deep in negative territory and well below industry peers.

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With shares trading at a steep discount to analyst targets and legal risks mounting, the key question for investors is whether Baxter is now attractively undervalued or if the stock’s woes are already reflected in the price.

Most Popular Narrative: 25.4% Undervalued

The most widely followed narrative places Baxter International’s fair value at a meaningful premium to its last close of $17.95, setting up a debate about whether market pessimism has gone too far or if extraordinary recovery is built into current expectations.

Baxter's strengthened focus on innovation, including new product launches in advanced infusion systems, AI-enabled devices, and compounding, aligns with growing demand for efficient, digitalized, and connected healthcare equipment. This positions the company to capture higher-margin revenue streams and gain market share.

Read the complete narrative.

Ready for the real story behind this valuation? Fierce projections for revenue, margin growth, and operating turnaround are just the tip of the iceberg. Which bold assumptions could send the stock soaring? Find out what makes this narrative so compelling and what analysts see that the market might be missing.

Result: Fair Value of $24.07 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, lingering supply chain issues and regulatory scrutiny over infusion pump quality could quickly challenge the case for a smooth recovery at Baxter.

Find out about the key risks to this Baxter International narrative.

Build Your Own Baxter International Narrative

If you see things differently or would rather dig into the details yourself, you can craft your own Baxter International narrative in just a few minutes. Do it your way

A great starting point for your Baxter International research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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