Stock Analysis on Net
Stock Analysis on Net

Baxter International Inc. (NYSE:BAX)

This company has been moved to the archive! The financial data has not been updated since August 4, 2016.

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Baxter International Inc., balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Dec 31, 2015 Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011
Developed technology, including patents 1,742 2,278 2,144 1,192 1,100
Other amortized intangible assets 393 443 494 280 276
Indefinite-lived intangible assets 86 272 465 22 35
Gross other intangible assets 2,221 2,993 3,103 1,494 1,411
Accumulated amortization (872) (914) (809) (680) (585)
Other intangible assets, net 1,349 2,079 2,294 814 826
Goodwill 2,687 3,874 4,205 2,502 2,317
Goodwill and other intangible assets, net 4,036 5,953 6,499 3,316 3,143

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

Item Description The company
Other intangible assets, net Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Baxter International Inc. other intangible assets, net decreased from 2013 to 2014 and from 2014 to 2015.
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Baxter International Inc. goodwill decreased from 2013 to 2014 and from 2014 to 2015.
Goodwill and other intangible assets, net Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Baxter International Inc. goodwill and other intangible assets, net decreased from 2013 to 2014 and from 2014 to 2015.

Adjustments to Financial Statements: Removal of Goodwill

Baxter International Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2015 Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011
Adjustment to Total Assets
Total assets (as reported) 20,975 25,917 25,869 20,390 19,073
Less: Goodwill 2,687 3,874 4,205 2,502 2,317
Total assets (adjusted) 18,288 22,043 21,664 17,888 16,756
Adjustment to Total Baxter Shareholders’ Equity
Total Baxter shareholders’ equity (as reported) 8,846 8,120 8,463 6,938 6,585
Less: Goodwill 2,687 3,874 4,205 2,502 2,317
Total Baxter shareholders’ equity (adjusted) 6,159 4,246 4,258 4,436 4,268

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

Baxter International Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Baxter International Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2015 Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011
Total Asset Turnover
Reported total asset turnover 0.48 0.64 0.59 0.70 0.73
Adjusted total asset turnover 0.55 0.76 0.70 0.79 0.83
Financial Leverage
Reported financial leverage 2.37 3.19 3.06 2.94 2.90
Adjusted financial leverage 2.97 5.19 5.09 4.03 3.93
Return on Equity (ROE)
Reported ROE 10.94% 30.75% 23.77% 33.53% 33.77%
Adjusted ROE 15.72% 58.81% 47.25% 52.43% 52.11%
Return on Assets (ROA)
Reported ROA 4.62% 9.63% 7.78% 11.41% 11.66%
Adjusted ROA 5.29% 11.33% 9.29% 13.00% 13.27%

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Baxter International Inc. adjusted total asset turnover ratio improved from 2013 to 2014 but then deteriorated significantly from 2014 to 2015.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Baxter International Inc. adjusted financial leverage ratio increased from 2013 to 2014 but then decreased significantly from 2014 to 2015.
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Baxter International Inc. adjusted ROE improved from 2013 to 2014 but then deteriorated significantly from 2014 to 2015.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Baxter International Inc. adjusted ROA improved from 2013 to 2014 but then deteriorated significantly from 2014 to 2015.

Baxter International Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2015 Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011
As Reported
Selected Financial Data (US$ in millions)
Net sales 9,968 16,671 15,259 14,190 13,893
Total assets 20,975 25,917 25,869 20,390 19,073
Activity Ratio
Total asset turnover1 0.48 0.64 0.59 0.70 0.73
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net sales 9,968 16,671 15,259 14,190 13,893
Adjusted total assets 18,288 22,043 21,664 17,888 16,756
Activity Ratio
Adjusted total asset turnover2 0.55 0.76 0.70 0.79 0.83

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

2015 Calculations

1 Total asset turnover = Net sales ÷ Total assets
= 9,968 ÷ 20,975 = 0.48

2 Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 9,968 ÷ 18,288 = 0.55

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Baxter International Inc. adjusted total asset turnover ratio improved from 2013 to 2014 but then deteriorated significantly from 2014 to 2015.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2015 Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011
As Reported
Selected Financial Data (US$ in millions)
Total assets 20,975 25,917 25,869 20,390 19,073
Total Baxter shareholders’ equity 8,846 8,120 8,463 6,938 6,585
Solvency Ratio
Financial leverage1 2.37 3.19 3.06 2.94 2.90
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 18,288 22,043 21,664 17,888 16,756
Adjusted total Baxter shareholders’ equity 6,159 4,246 4,258 4,436 4,268
Solvency Ratio
Adjusted financial leverage2 2.97 5.19 5.09 4.03 3.93

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

2015 Calculations

1 Financial leverage = Total assets ÷ Total Baxter shareholders’ equity
= 20,975 ÷ 8,846 = 2.37

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Baxter shareholders’ equity
= 18,288 ÷ 6,159 = 2.97

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Baxter International Inc. adjusted financial leverage ratio increased from 2013 to 2014 but then decreased significantly from 2014 to 2015.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2015 Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Baxter 968 2,497 2,012 2,326 2,224
Total Baxter shareholders’ equity 8,846 8,120 8,463 6,938 6,585
Profitability Ratio
ROE1 10.94% 30.75% 23.77% 33.53% 33.77%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Baxter 968 2,497 2,012 2,326 2,224
Adjusted total Baxter shareholders’ equity 6,159 4,246 4,258 4,436 4,268
Profitability Ratio
Adjusted ROE2 15.72% 58.81% 47.25% 52.43% 52.11%

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

2015 Calculations

1 ROE = 100 × Net income attributable to Baxter ÷ Total Baxter shareholders’ equity
= 100 × 968 ÷ 8,846 = 10.94%

2 Adjusted ROE = 100 × Net income attributable to Baxter ÷ Adjusted total Baxter shareholders’ equity
= 100 × 968 ÷ 6,159 = 15.72%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Baxter International Inc. adjusted ROE improved from 2013 to 2014 but then deteriorated significantly from 2014 to 2015.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2015 Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Baxter 968 2,497 2,012 2,326 2,224
Total assets 20,975 25,917 25,869 20,390 19,073
Profitability Ratio
ROA1 4.62% 9.63% 7.78% 11.41% 11.66%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Baxter 968 2,497 2,012 2,326 2,224
Adjusted total assets 18,288 22,043 21,664 17,888 16,756
Profitability Ratio
Adjusted ROA2 5.29% 11.33% 9.29% 13.00% 13.27%

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

2015 Calculations

1 ROA = 100 × Net income attributable to Baxter ÷ Total assets
= 100 × 968 ÷ 20,975 = 4.62%

2 Adjusted ROA = 100 × Net income attributable to Baxter ÷ Adjusted total assets
= 100 × 968 ÷ 18,288 = 5.29%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Baxter International Inc. adjusted ROA improved from 2013 to 2014 but then deteriorated significantly from 2014 to 2015.