Baxter is a deeply discounted, high-stakes “New Baxter” turnaround: deleveraging and connected-care ambitions can re-rate the stock, but the Novum IQ pump hold is the fulcrum risk.
Overview
Baxter is in the late innings of a multi-year transformation that is redefining the company after major divestitures and a shift toward a more focused medtech model. The January 2025 sale of Kidney Care (Vantive) for $3.8B—following the 2023 BioPharma Solutions sale—created a leaner company centered on Medical Products & Therapies, Healthcare Systems & Technologies, and Pharmaceuticals. In FY2025, continuing-ops sales were ~$11.244B (+6% reported; ~3% operational), supported by a “razor-and-blade” installed-base model in infusion and connected care. Baxter’s opportunity is to re-rate from distressed valuation by restoring infusion platform execution, scaling Ready-to-Use injectables, and realizing Hillrom synergies; its challenge is that profitability and investor confidence remain pressured by the Novum IQ shipment hold, margin compression, and elevated leverage.