Strong Demand and Positive Pricing to Drive Baxter's Q3 Earnings

Core Viewpoint - Baxter International Inc. is set to release its third-quarter 2024 results on November 8, with expectations of revenue growth and improved earnings per share compared to the previous year [1][2]. Q3 Estimates - The consensus estimate for revenues is $3.84 billion, reflecting a 3.6% increase from the prior-year quarter [2]. - The consensus estimate for earnings is 78 cents per share, indicating a 14.7% year-over-year improvement [2]. Factors to Note - Baxter anticipates sales growth of 3-4% on a reported basis and 4-5% at constant currency for Q3 [3]. - Adjusted earnings per share are expected to range between 77 cents and 79 cents [3]. Segment Performance - The Medical Products and Therapies segment is likely to benefit from sustained demand and positive pricing, particularly in Infusion Therapies and Technologies, aided by recent FDA approvals [4]. - The Pharmaceutical segment is expected to see growth driven by the U.S. injectables portfolio and new product launches [5]. - The Renal Care segment has shown a recovering trend, with growth in Acute Therapies and Peritoneal Dialysis products, although in-center hemodialysis sales may decline [7]. - The Acute Therapies segment is also expected to benefit from growth in the U.S. and strength in the APAC region [8]. Divestment Plans - The company plans to divest its Renal Care and Acute Therapies segments by late 2024 or early 2025, with discussions ongoing with Carlyle Group for a kidney care spinoff valued at over $4 billion [8]. Operational Efficiency - Ongoing transformation initiatives are likely to enhance operational efficiencies, potentially leading to lower expenses, although inflationary pressures and supply chain constraints may increase costs [9]. Earnings Prediction Model - The current model does not predict an earnings beat for Baxter, as the Earnings ESP is 0.00% and the Zacks Rank is 3 (Hold) [10][11].