Baxter International Inc. (BAX): A Value Play in Healthcare

BAX Liabilities data by YCharts

The chart attached above somewhat gauges the health of Baxter International. Although its liabilities and expenses have increased quite a lot, its cash flow from operations has shown a radical growth to outclass any financial crunch. Moreover its margins are also trending upwards, and I don’t think there’s anything worrisome about the company.

BAX Cash from Operations Quarterly data by YCharts

From the chart above, its not hard to conclude that the operating cash flow of Baxter International grew faster than its peers. But what’s important here is that its cash flow is already 3x to 4x larger than its peers, and even then it outperformed its smaller peers.

Conclusion

Both Gambro and Baxter are operating in the developing world, and their managements are well aware of their growth prospects. Although Becton Dickinson and C.R Bard have nothing against them, I think Baxter offers more value due to its Gambro acquisition. The company is already present in India and China, which are together resided by over 2.55 billion people. I believe that the organic growth in these countries alone could take the company higher. I think Baxter is worth a buy rating.

The article A Value Play in Healthcare originally appeared on Fool.com and is written by Piyush Arora.

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