Baxter International Inc. (NYSE:BAX) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that Baxter International will make substantially more sales than they'd previously expected. The stock price has risen 4.2% to US$83.91 over the past week, suggesting investors are becoming more optimistic. Whether the upgrade is enough to drive the stock price higher is yet to be seen, however.
After this upgrade, Baxter International's 13 analysts are now forecasting revenues of US$16b in 2022. This would be a huge 30% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$13b in 2022. It looks like there's been a clear increase in optimism around Baxter International, given the great increase in revenue forecasts.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Baxter International's growth to accelerate, with the forecast 23% annualised growth to the end of 2022 ranking favourably alongside historical growth of 3.7% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 8.7% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Baxter International is expected to grow much faster than its industry.
The Bottom Line
The highlight for us was that analysts increased their revenue forecasts for Baxter International next year. The analysts also expect revenues to grow faster than the wider market. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at Baxter International.
Hungry for more information? At least one of Baxter International's 13 analysts has provided estimates out to 2023, which can be seen for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
What are the risks and opportunities for Baxter International?
Trading at 40% below our estimate of its fair value
Earnings are forecast to grow 64.46% per year
Debt is not well covered by operating cash flow
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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.