Analyst recommendations for Baxter
Let’s have a look at Wall Street analysts’ recommendations and target prices for Baxter International’s (BAX) stock over the next year. Based on recommendations of 16 broker firms in a Bloomberg survey, 19% of them gave Baxter a consensus rating of “buy.” The company was rated “hold” by 81% of the analysts. None of the firms rated Baxter a “sell.”
Notably, Baxter mainly got a “hold” rating even after the company reported better-than-expected results in 1Q16 and raised its earnings guidance for fiscal 2016.
The table above lists the nine brokerage firms that provided a target price for Baxter for the next 12 months. The consensus 12-month target price is $46.78, amounting to a 5.9% return potential. This compares to Baxter’s price of $44.18 on April 27, 2016.
As of April 28, 2016, UBS gave Baxter a one-year target price of $40, the lowest target price of all. This target implies a -9.5% return over the next 12 months. Among the large investment banks, Goldman Sachs gave Baxter a one-year target price of $51, which implies a ~15.4% return potential over the next 12 months.
Peers Becton Dickinson (BDX), CR Bard (BCR), and ResMed (RMD) have average broker target prices of $165.13, $223.6, and $60.75, respectively. These figures imply returns of 2%, 3.6%, and 7.3%, respectively, in the next 12 months.
ETFs with exposure to Baxter
Investors can get exposure to Baxter International by investing in the iShares S&P 500 Value ETF (IVE), which has 0.27% of its total holdings in Baxter.
One of the dividend ETFs, the PowerShares S&P 500 High Dividend Low Volatility Portfolio ETF (SPHD), tracks dividend yield weighted index that comprises the 50 least-volatile stocks shortlisted from the 75 stocks that constitute S&P 500 and have the highest dividend yield. Baxter accounts for about 1.6% of SPHD’s total holdings.
Investors can also gain exposure to Baxter through the iShares Core S&P 500 ETF (IVV), which has 0.13% of its total holdings in Baxter.