Baxter International Inc. BAX
reported first-quarter 2019 adjusted earnings of 76 cents per
share, which surpassed the Zacks Consensus Estimate of 68 cents by
11.8%. The bottom line also improved 8.6% from the year-ago
quarter.
Revenues of $2.63 billion outpaced the Zacks Consensus Estimate of
$2.62 billion. The top line declined 1.7% year over year on a
reported basis but increased 2% on operational basis.
Geographical Details
Baxter reports operating results through three geographic segments:
Americas (North and South America), EMEA (Europe, Middle East and
Africa) and APAC (Asia Pacific).
In Americas, Baxter recorded revenues of $1.41 billion, down 2.4%
on a year-over-year basis and 1% at constant currency (cc).
In EMEA, revenues totaled $705 million, down 2.6% from the year-ago
quarter but up 4% at cc.
In APAC, revenues of $519 million increased 1.6% from the
prior-year quarter and 7% at cc.
Baxter International Inc. Price, Consensus and EPS Surprise
Baxter International Inc. Price, Consensus and EPS Surprise | Baxter International Inc. Quote
Segmental Details
Renal Care
This segment reported revenues of $851 million in the quarter under
review, down 1.9% year over year. Revenues at the segment increased
3% at cc.
Medication Delivery
Revenues at the segment grossed $634 million, down 6.2% from the
year-ago quarter and 4% at cc.
Pharmaceuticals
Revenues at the segment amounted to $509 million, up 2.6% from the
year-ago quarter and 6% at cc.
Clinical Nutrition
Revenues at the segment were $205 million, down 8.1% from the
year-ago quarter and 5% at cc.
Advanced Surgery
Revenues at the segment totaled $198 million, up 8.8% from the
year-ago quarter and 12% at cc.
Acute Therapies
This segment reported revenues of $128 million, down 0.8% from the
prior-year quarter but increased 4% at cc.
Other
Revenues in the segment grossed $107 million, up 3.9% on a
year-over-year basis and 8% at cc.
Margin Analysis
Baxter registered adjusted gross profit of $1.15 billion in the
first quarter, down 1.8% year over year. As a percentage of
revenues, gross margin contracted 10 bps on a year-over-year basis
at 43.7% in the first quarter.
Operating income decreased 11.1% year over year to $384 million in
the quarter under review. As a percentage of revenues, operating
margin expanded 40 bps to 17.1% in first-quarter 2019.
Guidance
On the basis of the strong performance in the first quarter, Baxter
raised earnings guidance for 2019.
Adjusted earnings are anticipated to be in the band of $3.27-$3.35
per share, up from the previously guided range of $3.22-$3.30 per
share. The Zacks Consensus Estimate for earnings stands at $3.27,
within the companyâs guided range.
The company expects sales growth in the range of 0-1% on a reported
basis, 2-3% at cc and 3-4% on an operational basis.
For the second quarter of 2019, management at Baxter expects
revenues to decline approximately 2% on a reported basis, up
approximately 2% at cc and improve in the range of 2-3% on an
operational basis. Adjusted earnings are projected to be in the
range of 80-82 cents per share. The Zacks Consensus Estimate is
pegged at 81 cents, which lies within the guided range.
Summing Up
Baxter ended the first quarter of 2019 on a solid note, beating the
Zacks Consensus Estimate on both counts. The stock continues to
benefit from its core Advanced Surgery, Pharmaceuticals and Other
units.
Growth in APAC buoys optimism. The company has received approval
for faster preparation of Floseal Hemostatic Matrix, announced the
availability of a NantHealth digital health solution and planned
U.S. launch of Clinolipid. This apart, collaboration with
bioMerieux and introduction of ready-to-use eptifibatide â a
platelet aggregation inhibitor that prevents platelets from
sticking together and clotting, are added positives.
In the quarter under review, the company witnessed operating margin
expansion. Based on the strong first quarter performance, Baxter
raised 2019 earnings outlook.
Meanwhile, Baxterâs Medication Delivery and Clinical Nutrition
units have been witnessing sluggishness in recent times. Cutthroat
competition in the MedTech markets is indicative of dull
prospects.
Zacks Rank and Other Key Picks
Baxter currently carries a Zacks Rank #2 (Buy).
Investors interested in the broader medical space can consider some
other top-ranked stocks like Bio-Rad Laboratories, Inc. BIO, ICU
Medical Inc. ICUI and DENTSPLY SIRONA Inc. XRAY.
Bio-Rad is scheduled to release first-quarter 2019 results on May
8. The Zacks Consensus Estimate for the quarterly adjusted EPS is
pegged at $1.12. The consensus estimate for revenues stands at
$548.8 million. The stock sports a Zacks Rank #1 (Strong Buy). You
can see the complete list of todayâs Zacks #1 Rank stocks
here .
ICU Medical is scheduled to release first-quarter
2019 results on May 9. The Zacks Consensus Estimate for the
periodâs adjusted EPS is pegged at $2.18. The consensus estimate
for revenues stands at $321.1 million. The stock carries a Zacks
Rank #2.
DENTSPLY SIRONA is slated to release first-quarter 2019 results on
May 3. The Zacks Consensus Estimate for the quarterly adjusted EPS
stands at 38 cents. The consensus estimate for revenues is pegged
at $917.1 million. The stock has a Zacks Rank of 2.
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