Baxter International Inc. (BAX) vs ResMed Inc. (RMD)

Baxter International Inc. and ResMed Inc. are both Medical Instruments & Supplies companies. ResMed Inc. is the larger, with a market value of $33.7B against $13.3B — 2.5× the size. Baxter International Inc. has negative trailing earnings, so its P/E is not meaningful; ResMed Inc. trades at 21.7×. ResMed Inc. grew revenue faster over the last twelve months: 9.04% against 5.33%. ResMed Inc. has the higher net margin (27.8% vs −6.23%) and the higher return on invested capital (22.8% vs −1.05%). Both pay a dividend; ResMed Inc. yields more (1.03% vs 0.16%). Across the 22 metrics below, ResMed Inc. leads on 16 and Baxter International Inc. on 6.

Valuation

Metric BAX RMD Medical Instruments & Supplies median
P/E n/m 21.69 30.28
P/S 1.14 5.96 2.49
P/B 2.04 5.74 2.34
Price to free cash flow 11.63 21.50 23.49
EV/EBITDA 13.15 15.66 14.87
EV/Sales 1.71 5.82 2.75
Earnings yield (5.52%) 4.61% 0.00%
Free cash flow yield 8.60% 4.65% 0.59%

Profitability

Metric BAX RMD Medical Instruments & Supplies median
Gross margin 30.09% 61.13% 53.60%
Operating margin (1.90%) 33.02% 1.97%
Net margin (6.23%) 27.79% 0.00%
Free cash flow margin 9.79% 27.71% 2.36%
Return on equity (10.56%) 26.40% 0.00%
Return on assets (3.57%) 19.29% 0.00%
Return on invested capital (1.05%) 22.81% 0.13%

Growth

Metric BAX RMD Medical Instruments & Supplies median
Revenue growth (TTM) 5.33% 9.04% 8.97%
EPS growth (last fiscal year) (47.24%) 9.67% 6.51%
Revenue growth, 5-year CAGR (0.75%) 12.08% 8.85%
Net income growth, 5-year CAGR 0.00% 26.27% 0.00%

Health

Metric BAX RMD Medical Instruments & Supplies median
Debt to equity 1.33 0.04 0.10
Current ratio 1.79 2.65 2.47
Net debt to EBITDA 5.19 (0.50) 0.97

Dividend

Metric BAX RMD Medical Instruments & Supplies median
Dividend yield 0.16% 1.03% 1.02%
Payout ratio — 0.22 0.27

Size

Metric BAX RMD Medical Instruments & Supplies median
Market cap 13.27b 33.66b 1.71b

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