Baxter International Inc. BAX is scheduled to release fourth-quarter 2024 results on Feb. 13, before the opening bell. In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 2.56%. BAX’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 3.62%.

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Q4 Estimates

Currently, the consensus estimate for revenues is pegged at $2.66 billion, indicating a decline of 31.5% from the prior-year quarter’s reported figure. However, the consensus mark for earnings is pinned at 52 cents per share, implying a 40.9% year-over-year decline.

Our model estimates total revenues to decline 3.3% at constant currency (cc) to $2.67 billion. Adjusted earnings per share are expected to decline 4.7% to 81 cents.

Factors to Note

Baxter is likely to report mixed fourth-quarter 2024 results, with strong momentum in certain product lines tempered by operational challenges and macroeconomic pressures. While the company posted adjusted EPS of 80 cents in the third quarter, revenues from continuing operations rose 4% to $2.7 billion. Key macro drivers that are likely to have shaped fourth-quarter performance include the ongoing recovery from Hurricane Helene, which significantly impacted Baxter’s North Cove facility, and cost-control initiatives aimed at mitigating stranded costs following the Kidney Care divestiture. Additionally, some tailwinds from pricing initiatives and operational efficiencies are expected to have aided its performance.

The Medical Products & Therapies segment is likely to have witnessed near-term pressure from Hurricane Helene, which disrupted IV solutions production, potentially causing a headwind of $150-$160 million to sales during the fourth quarter. However, Baxter’s efforts to ramp up production, prioritize high-demand products and leverage global manufacturing sites should have partially offset the adverse impact.

Strong growth in infusion therapies, particularly within the Novum IQ pump platform, remains a bright spot as it continues to gain market share through competitive conversions and new customer uptake. The trend is likely to have continued in the soon-to-be-reported quarter.

Meanwhile, the Advanced Surgery division is expected to have sustained steady demand for its hemostats and sealants portfolio, supporting overall segment stability. Our model estimates total segmental sales to decline 5.1% at cc to $1.27 billion.

Baxter International Inc. Price and EPS Surprise

Baxter International Inc. price-eps-surprise | Baxter International Inc. Quote

In the Healthcare Systems & Technologies segment, fourth-quarter results are likely to reflect lingering softness in the U.S. primary care market, ongoing delays in international capital spending, and continued weakness in France and China. However, patient support systems should have shown resilience, growing in the low double-digits, supported by strong order pipelines and hospital investment in care and connectivity solutions.

The Frontline Care division might have remained challenged, but a stabilization in the primary care market, coupled with new product launches in 2025, should have led to improved performance. Our model estimates total segment sales to decline 6.3% at cc to $744.8 million.

Baxter’s Pharmaceuticals segment is likely to have seen a rebound in the fourth quarter following a weaker third quarter, where injectable and anesthesia sales were affected by phasing issues and supply constraints. The company’s injectable drug portfolio, with a pipeline of new product launches driving recovery, is likely to have delivered a strong performance.

Drug compounding might have remained a growth driver that is likely to have benefited from strong demand. However, the segment’s overall margin profile could have remained under pressure, and sustained cost optimization must have been crucial. Our model estimates total segmental sales to improve 5.3% at cc to $638.5 million.

Looking ahead, while the impact of Hurricane Helene poses a short-term headwind, Baxter’s focus on operational efficiency, pricing strategies and accelerating product innovation should have supported stabilization and modest growth in the fourth quarter. The company anticipates sales to decline in the low single digits on a reported basis as well as at cc. Adjusted EPS is expected to be between 77 cents and 81 cents.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Baxter this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00% for Baxter.

You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: Baxter currently has a Zacks Rank #3 (Hold).

Stocks Worth a Look

Here are a few medical stocks worth considering, as these have the right combination of elements to come up with an earnings beat this reporting cycle.

Natera NTRA has an Earnings ESP of +61.91% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

NTRA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 36.37%. The Zacks Consensus Estimate for fourth-quarter EPS implies a rise of 34.4% from the year-ago reported figure.

Masimo MASI has an Earnings ESP of +4.05% and a Zacks Rank #2 at present. 

The company is scheduled to release fourth-quarter 2024 results on Feb. 25. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 17.10%. The Zacks Consensus Estimate for EPS implies an improvement of 14.4% from the year-ago reported figure.

Maravai LifeSciences MRVI has an Earnings ESP of +10.00% and a Zacks Rank #3 at present. The company is expected to release fourth-quarter 2024 results in February.

MRVI delivered a trailing four-quarter average earnings surprise of 116.67%. The Zacks Consensus Estimate for fourth-quarter EPS implies a decline of 400% from the year-ago reported figure.

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Baxter International Inc. (BAX) : Free Stock Analysis Report

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