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Baxter’s Latest Dividend and Share Repurchase Authorization

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Quarterly cash dividend

Baxter International (BAX) announced a quarterly cash dividend of $0.13 per share on November 8, 2016. It will be payable on January 3, 2017, to shareholders of record as of December 2, 2016. 

This dividend is the same as the dividend BAX paid in the previous quarter. It’s higher than the dividend of $0.12 per share BAX paid in each of the three quarters following its Baxalta (BXLT) spin-off.

BAX was paying consistent dividends of $0.52 per share to its shareholders before the spin-off of its Biosciences division, Baxalta. The proceeds of the spin-off have also been used to pay dividends to Baxter’s shareholders.

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Baxter International has a dividend yield of ~1.2%. Its peers Becton, Dickinson and Company (BDX), C. R. Bard (BCR), and ResMed (RMD) have dividend yields of ~0.46%, 1.5%, and 2.1%, respectively. If you’re interested in getting diversified exposure to Baxter International, you can invest in the First Trust Health Care AlphaDEX ETF (FXH), which holds ~2.2% in Baxter.

Baxter’s share repurchase authorization program

On November 8, 2016, Baxter International approved a $1.5 billion rise in its authorized share repurchase plan. Now, the company has a total share repurchase authorization of $1.9 billion. The company has consistently followed a disciplined capital allocation strategy. It also continues to focus on balanced reinvestment in its business along with the return of value to its shareholders through dividends and buybacks.

Baxter has aimed for a dividend payout ratio of ~35% of its adjusted net income since its Baxalta spin-off.

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