BAX Stock Declines Despite Latest Product Launch Boosting Patient Care

Baxter International Inc. BAX, on Thursday, announced the introduction of Hemopatch Sealing Hemostat with room temperature storage. It is a ready-to-use absorbable collagen pad intended for tissue sealing, dura sealing and hemostasis (the stopping of a flow of blood).

Per Baxter, the Hemopatch Sealing Hemostat is effective and safe for use in open surgery and minimally invasive surgery. It is currently available to order throughout Europe.

The Hemopatch Sealing Hemostat has been used by surgeons as a reliable solution for tissue sealing, dura sealing and hemostasis for a long period of time. The product now includes the innovation of including room temperature storage, which resulted from the collaboration between surgeons and Baxter.

With the latest product innovation, BAX aims to boost its Advanced Surgery business under the broader Medical Products & Therapies segment and promote enhanced patient care.

Likely Trend of BAX Stock Following the News

Following the announcement, shares of the company lost nearly 9.5% till last trading.

Historically, the company has gained a top-line boost from its various product innovations. Although the latest announcement is likely to benefit BAX’s top-line growth going forward, the stock declined overall.

Baxter currently has a market capitalization of $14.28 billion. It has an earnings yield of 8.9%, better than the industry’s negative yield. In the last reported quarter, BAX delivered an earnings surprise of 11.5%.

Significance of Baxter’s Latest Launch

Per Baxter, the evolution of the product will likely optimize accessibility in the operating room, thereby delivering an immediate solution for surgeons to control bleeding or prevent leakage.

Per an expert familiar with the use of Hemopatch Sealing Hemostat, it eliminates the need for refrigeration and increases product shelf life. These are crucial improvements as it will likely enable surgeons to have the product available in the operating room. After application, the product shows an enhanced adhesive strength, thus achieving better surgical outcomes.

Per management, removing the need for refrigeration is expected to address customers’ requirements of having the product on hand in critical situations.

Industry Prospects in Favor of BAX

Per a report by Grand View Research, the global hemostasis and tissue sealing agents market was estimated at $8.67 billion in 2024 and is projected to expand at a CAGR of 9% between 2025 and 2030. Factors like increased demand supported by rising surgery volumes and growing demand for critical care among the elderly population due to their vulnerability to slow-healing injuries and wounds are likely to drive the market.

Given the market potential, the latest product availability is expected to provide a significant boost to Baxter’s business.

Baxter’s Notable Development

In February, BAX reported its fourth-quarter 2024 results, wherein its Medical Products & Therapies segment recorded growth at constant currency rates. The segment’s performance also reflected strong performance from Baxter’s infusion systems product portfolio, driven by robust sales for the Novum IQ infusion pump, increased sales of parenteral nutrition products and strong demand for Advanced Surgery products.

BAX’s Share Price Performance

Shares of the company have lost 30.5% in the past year against the industry’s 4.2% growth and the S&P 500’s rise of 6.5%.

Baxter’s Zacks Rank & Key Picks

Currently, BAX carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space are Abbott Laboratories ABT, Cencora, Inc. COR and LeMaitre Vascular, Inc. LMAT.

Abbott, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 10.4%. ABT’s earnings surpassed estimates in three of the trailing four quarters and broke even once, the average surprise being 1.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Abbott’s shares have gained 16.5% compared with the industry’s 4.2% growth in the past year.

Cencora, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 12.1%. COR’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 4.9%.

Cencora has gained 21.4% against the industry’s 16.4% decline in the past year.

LeMaitre Vascular, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 17%. LMAT’s earnings surpassed estimates in three of the trailing four quarters and broke even once, the average surprise being 8.7%.

LeMaitre Vascular’s shares have rallied 28.5% compared with the industry’s 4.2% growth in the past year.

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This article originally published on Zacks Investment Research (zacks.com).

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