The stock of Baxter International (BAX 14.50%), a specialist of long standing in the medical device and associated products space, could have used a little pick-me-up on Thursday. The company posted a mixed third quarter that missed on analyst profitability estimates. An unforgiving market sent its share price down by almost 15% that trading session alone.
Two metrics going in the opposite direction
Before market open, Baxter published those quarterly figures. They revealed that total sales rose 5% year over year to $2.84 billion, while net income not according to generally accepted accounting principles (GAAP) sank by 14% to $355 million ($0.69 per share).
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Funnily enough, the improved revenue figure was below the consensus analyst estimate of $2.88 billion, but the shrunken non-GAAP (adjusted) net profit beat the $0.60 projection.
Baxter divides its business into three segments, two of which posted net sales growth during the quarter. Pharmaceuticals led the way with a 7% gain, to $632 million, while healthcare systems and technologies rose by 3% to $773 million. On the other hand, medical products and therapies declined by 1% to slightly under $1.33 billion. The "other" category rose more than fivefold to $101 million.
NYSE: BAX
Key Data Points
Guidance comes up short
Another factor bringing the bears to Baxter stock Thursday was its guidance. For the full year, management is now anticipating sales growth of 1% to 2% over the 2024 result. Adjusted net income for the period is forecast at $2.35 to $2.40 per share, below the average analyst estimate of $2.44.
