Baxter International At A 52-Week High On Solid Product Line

Share price of Deerfield, IL-based Baxter International Inc. (NYSE:BAX) scaled a new 52-week high of $59.49 on May 30, eventually closing a bit lower at $59.35. The company has gained around 17% over the past three months, much better than the S&P 500’s addition of 3%.

Average volume of shares traded over the last three months was remarkable at approximately 3.1 million. The stock has a market cap of $32.27 billion.

Over the past three months, this Zacks Rank #1 (Strong Buy) has steadily outshined the Zacks categorized Medical - Products with respect to share price. The stock has climbed 17%, way higher than the broader industry’s gain of 5.4%.

Further, the company’s estimate revision trend for the current quarter is favorable. In the past 60 days, seven estimates have moved up with no downward revision. The magnitude of estimate revision over the same time period increased 11.8% to 57 cents per share.

The company also has a four-quarter average positive earnings surprise of 17.14%.

Growth Drivers

The latest 52-week high came on the back of the company’s impressive product pipeline. The company has launched a new version of its AK 98 hemodialysis (HD) system to help dialysis providers minimize the operational challenges associated with hemodialysis.

Baxter International also recently achieved a regulatory milestone for its advanced dialysis technology. The company received guidance from the FDA clarifying the regulatory pathway for its home peritoneal dialysis (PD) solution system to improve patient access to home dialysis.

Notably, Baxter International’s home solution system is the first known technology designed to reduce storage and weight handling requirements that come with traditional PD therapy. Management claims to have the first patient on therapy with the new system as part of a clinical trial in 2018. Regulatory submission is expected in 2019.

Meanwhile, we are looking forward to management’s decision to acquire Claris Lifesciences Limited’s subsidiary Claris Injectables Limited for almost $625 million. The takeover will provide Baxter International with a robust portfolio of ‘generic injectables with 11 molecules, which are approved in the U.S. Of late, Baxter International has accelerated its pace of acquisitions and strategic collaborations that enhance its portfolio, thereby opening up significant long-term growth opportunities.

All these factors are expected to boost the company’s share price in the days ahead.

Other Key Picks

Other top-ranked stocks in the broader medical sector are Luminex Corporation (NASDAQ:LMNX) , Inogen, Inc. (NASDAQ:INGN) and Accelerate Diagnostics, Inc. (NASDAQ:AXDX) . Notably, Luminex and Inogen sport a Zacks Rank #1, while Accelerate Diagnostics carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Luminex has an expected long-term adjusted earnings growth of almost 16.3%. The stock added roughly 7% over the last three months.

Inogen has a long-term expected earnings growth rate of 17.5%. The stock has a solid one-year return of around 82%.

Accelerate Diagnostics has an expected long-term adjusted earnings growth of 30% (last 3–5 years of actual earnings). The stock added roughly 10% over the last three months.

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