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Wednesday, 03/20/2002

BAX - Baxter

Company Description


Baxter's BioScience business provides biopharmaceuticals derived from human plasma or recombinant technology to treat hemophilia, immune deficiencies and other blood-related disorders. It also provides vaccines for the prevention and treatment of certain infectious diseases, as well as biosurgery products. Baxter's breadth and depth of expertise in recombinant protein manufacturing, plasma fractionation, and proprietary vero cell vaccine manufacturing technology sets it apart from others in the field.

Medication Delivery

Baxter develops and manufactures a wide range of products for the delivery of fluids and medications to patients. The company is known worldwide as a leading manufacturer of intravenous (IV) solutions, which make up 20% of Baxter's sales in the area of medication delivery. The remainder of the revenue generated by the Medication Delivery business comes from specialty products that include premixed medications and drug reconstitution systems, infusion pumps and devices used to administer IV medications to patients; nutrition products and equipment for mixing IV nutrition; anesthetics and delivery systems used in surgery and critical care settings; and oncology products.


Baxter has long served the needs of people with chronic kidney disease and end-stage renal disease (ESRD). In 1956, the company introduced the first disposable coil dialyzer, a development that greatly enhanced the use and application of hemodialysis (HD). Nearly 20 years later, Baxter was one of the first companies to introduce products and services for peritoneal dialysis (PD), usually a home-based treatment.

(Source: Baxter)

Reasons To Invest

For its most recent quarter, Baxter reported strong fourth quarter revenues from its hemophilia treatment. The company's profits matched the market's expectations, and the firm went on to set impressive growth goals for both sales and profits.

Baxter reported earnings of 53 cents per share for the most recent period, while the year ago total reached 45 cents per share in profits -- an attractive 17 percent increase. The company reached its EPS target on sales of $2.14 billion, which amounted to an 11 percent increase over last year's revenues.

The company said that its Bioscience and Medication Delivery businesses should each grow by about 15 percent in the coming year. While its Renal division is expected to grow by about 17 to 18 percent.

Baxter expects to achieve its growth in the Biosciences division through ramping production of its hemophilia drug. The increase in production will contribute to sales growth starting this year through 2006.

Management is committed to increasing operational efficiency while growing sales, which will help to boost earnings growth in the coming years. Additionally, the company is on track to supply consumers and the government with new treatments for a variety of blood and immune disorders, plus cancer and kidney diseases. For instance, the company is scheduled to provide the U.S. government with a smallpox vaccine through its European partnerships.

The company's recent shift away from a stodgy medical supply company to a more technology driven provider of treatments for disease should boost earnings and continue to attract a premium versus other health care stocks.

DRIP Information:
Shares to Qualify = 1           Accept Foreign Accounts: Yes
Auto-reinvestment = No          Temper Enrollment Serv:  Yes

Min/Max Investment = $25 to $25,000/year

Reinvestment Fees -

Div : 0 
Cash: 0
Auto: N/A

Transfer Agent:

First Chicago Trust


Industry Group: Medical Products  52-week high=$58.04
Annual Dividend Per Share=  0.58  52-week low =$42.51
Last earnings 01/18   est = 0.53  actual = 0.53
Next earnings 04-20   est = 0.41  versus = 0.35
                                    P/E =    52
Analyst Ratings:
Strong Buy    = 0
Moderate Buy  = 0
Hold          = 0
Moderate Sell = 0
Strong Sell   = 0


Copyright 2003

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