DCF Studio

    BAX · NYQ · Healthcare

    Baxter International Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 10.71

    Market price

    USD 24.22

    Implied upside

    -55.8%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Value Per Share

    Perpetuity growth
    USD 10.71-55.8%
    Exit multiple
    USD 28.13+16.1%
    Market price
    USD 24.22

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0m381m762mFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 11.7bnUSD 12.0bnUSD 12.2bnUSD 12.5bnUSD 12.8bnUSD 13.1bnUSD 13.4bnUSD 13.7bnUSD 14.1bnUSD 14.4bn+2.3%
    EBITUSD 356.8mUSD 364.6mUSD 372.7mUSD 381.2mUSD 389.9mUSD 399.1mUSD 408.6mUSD 418.5mUSD 428.8mUSD 439.5m+2.3%
    NOPATUSD 281.9mUSD 288.1mUSD 294.5mUSD 301.1mUSD 308.1mUSD 315.3mUSD 322.8mUSD 330.6mUSD 338.7mUSD 347.2m+2.3%
    Add depreciation & amortisationUSD 1.1bnUSD 1.1bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.3bnUSD 1.3bnUSD 1.3bnUSD 1.3bnUSD 1.4bn+2.3%
    Less capital expenditureUSD -570.2mUSD -600.1mUSD -631.3mUSD -663.8mUSD -697.7mUSD -733.2mUSD -770.2mUSD -808.9mUSD -849.3mUSD -891.6m+5.1%
    Capex, % of revenue4.9%5.0%5.2%5.3%5.5%5.6%5.7%5.9%6.0%6.2%-
    Less increase in working capitalUSD -123.9mUSD -69.1mUSD -71.9mUSD -74.8mUSD -77.9mUSD -81.0mUSD -84.3mUSD -87.8mUSD -91.4mUSD -95.1m-2.9%
    Free cashflow to firmUSD 707.0mUSD 762.5mUSD 760.3mUSD 758.0mUSD 755.4mUSD 752.7mUSD 749.7mUSD 746.4mUSD 742.8mUSD 738.8m+0.5%
    Discount factor0.96680.90370.84470.78950.73790.68970.64470.60260.56330.5265-
    Present valueUSD 683.5mUSD 689.0mUSD 642.2mUSD 598.4mUSD 557.5mUSD 519.2mUSD 483.3mUSD 449.8mUSD 418.4mUSD 389.0m-
    Present Value Of The ForecastUSD 5.4bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.779Reported 0.670, pulled toward 1.0 (Blume)
    Cost of equity8.19%Risk-free + beta x equity risk premium
    Cost of debt6.89%Risk-free + 200bp, the spread for a C rating at 0.6x interest cover, capped at 200bp because one year's cover is too noisy to charge more. Book interest / average debt was lower, at 2.5%.
    Market capitalisationUSD 12.5bn56.2% of capital
    Total debtUSD 9.8bn43.8% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC6.99%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 10.71

    59% of EV

    Forecast FCFF, final year
    USD 738.8m
    Capex at depreciation, working capital in reinvestment
    USD 1.0bn
    Less reinvestment at g/ROIC (35.8% of NOPAT)
    USD -365.0m
    Capitalised
    USD 655.1m
    ROIC (WACC floor)
    7.0%
    Terminal value, undiscounted
    USD 15.0bn
    Terminal value, discounted
    USD 7.9bn
    Enterprise value
    USD 13.3bn
    Less net debt
    USD 7.8bn
    Equity value
    USD 5.5bn

    Exit at 17.6x EBITDA

    Value per shareUSD 28.13

    76% of EV

    Terminal value, undiscounted
    USD 31.9bn
    Terminal value, discounted
    USD 16.8bn
    Enterprise value
    USD 22.2bn
    Less net debt
    USD 7.8bn
    Equity value
    USD 14.4bn

    Spread between methods: 90%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.99%22.1721.6321.0820.5419.99
    5.99%15.8915.4615.0314.6014.17
    6.99%11.4111.0610.7110.3610.02
    7.99%8.057.767.477.196.90
    8.99%5.445.204.964.724.47

    Outlined: this model. Green text: above today's price of 24.22. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year3.8%2.5%8.7%
    EBIT margin6.8%3.0%7.7%
    Discount rate-7.0%4.6%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.