Return on Equity (ROE)
since 2005
Calculation
Baxter International Inc., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income attributable to Baxter1 | ÷ | Total Baxter shareholders’ equity1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2015 | 10.94% | = | 100 | × | 968) | ÷ | 8,846) |
| Dec 31, 2014 | 30.75% | = | 100 | × | 2,497) | ÷ | 8,120) |
| Dec 31, 2013 | 23.77% | = | 100 | × | 2,012) | ÷ | 8,463) |
| Dec 31, 2012 | 33.53% | = | 100 | × | 2,326) | ÷ | 6,938) |
| Dec 31, 2011 | 33.77% | = | 100 | × | 2,224) | ÷ | 6,585) |
| Dec 31, 2010 | 21.62% | = | 100 | × | 1,420) | ÷ | 6,567) |
| Dec 31, 2009 | 30.66% | = | 100 | × | 2,205) | ÷ | 7,191) |
| Dec 31, 2008 | 32.33% | = | 100 | × | 2,014) | ÷ | 6,229) |
| Dec 31, 2007 | 24.68% | = | 100 | × | 1,707) | ÷ | 6,916) |
| Dec 31, 2006 | 22.27% | = | 100 | × | 1,397) | ÷ | 6,272) |
| Dec 31, 2005 | 22.24% | = | 100 | × | 956) | ÷ | 4,299) |
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), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$ in millions
The financial performance between 2005 and 2015 is characterized by significant volatility in profitability relative to the equity base. While shareholders' equity showed a long-term growth trend, the return on equity experienced sharp fluctuations, culminating in a severe decline in the final year of the period.
- Net Income Trends
- Net income exhibited a general upward trajectory from 2005 to 2009, increasing from 956 million USD to 2,205 million USD. After a contraction in 2010, earnings recovered to reach a peak of 2,497 million USD in 2014. However, this growth was reversed in 2015, when net income fell sharply to 968 million USD, returning to levels approximately equivalent to those recorded in 2005.
- Shareholders' Equity Expansion
- Total shareholders' equity grew steadily over the analyzed period, rising from 4,299 million USD in 2005 to 8,846 million USD by 2015. This more than twofold increase in the capital base indicates a consistent accumulation of equity, which placed increasing pressure on net income to grow at a similar pace to maintain return on equity ratios.
- Return on Equity (ROE) Dynamics
- ROE demonstrated considerable volatility, with multiple peaks exceeding 30% in 2008, 2009, 2011, 2012, and 2014. A period of instability is evident between 2010 and 2015, marked by sharp oscillations. The sequence concludes with a precipitous drop in 2015, where ROE fell to 10.94%, the lowest value recorded in the eleven-year span.
- Efficiency and Correlation Analysis
- The collapse of ROE in 2015 is the result of a divergence between net income and shareholders' equity. While equity reached its maximum value of 8,846 million USD in 2015, the simultaneous decrease in net income led to a significant reduction in the efficiency of capital utilization, resulting in the lowest return on equity for the entire period analyzed.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?
Comparison to Competitors
Baxter International Inc., ROE, long-term trends, comparison to competitors
| Baxter International Inc. | Abbott Laboratories | Elevance Health Inc. | Intuitive Surgical Inc. | Medtronic PLC | UnitedHealth Group Inc. | |
|---|---|---|---|---|---|---|
| Dec 31, 2015 | 10.94% | 20.85% | 11.11% | 13.63% | 5.03% | 17.18% |
| Dec 31, 2014 | 30.75% | 10.61% | 10.60% | 12.39% | 15.76% | 17.31% |
| Dec 31, 2013 | 23.77% | 10.23% | 10.05% | 19.16% | 18.57% | 17.50% |
| Dec 31, 2012 | 33.53% | 22.32% | 11.16% | 18.34% | 21.14% | 17.72% |
| Dec 31, 2011 | 33.77% | 19.35% | 11.36% | 18.71% | 19.39% | 18.17% |
| Dec 31, 2010 | 21.62% | 20.66% | 12.12% | 18.74% | 21.18% | 17.94% |
| Dec 31, 2009 | 30.66% | 25.14% | 19.09% | 15.13% | 16.88% | 16.19% |
| Dec 31, 2008 | 32.33% | 27.92% | 11.62% | 16.13% | 19.34% | 14.33% |
| Dec 31, 2007 | 24.68% | 20.28% | 14.55% | 16.26% | 25.53% | 23.20% |
| Dec 31, 2006 | 22.27% | 12.22% | 12.59% | 12.22% | 27.14% | 19.99% |
| Dec 31, 2005 | 22.24% | 23.39% | 9.86% | 21.27% | 17.26% | 18.61% |
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), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Health Care Equipment & Services)
Baxter International Inc., ROE, long-term trends, comparison to sector (health care equipment & services)
| Baxter International Inc. | Health Care Equipment & Services | |
|---|---|---|
| Dec 31, 2015 | 10.94% | 11.84% |
| Dec 31, 2014 | 30.75% | 13.81% |
| Dec 31, 2013 | 23.77% | 14.22% |
| Dec 31, 2012 | 33.53% | 17.99% |
| Dec 31, 2011 | 33.77% | 17.02% |
| Dec 31, 2010 | 21.62% | 17.62% |
| Dec 31, 2009 | 30.66% | 19.50% |
| Dec 31, 2008 | 32.33% | 17.63% |
| Dec 31, 2007 | 24.68% | 20.02% |
| Dec 31, 2006 | 22.27% | 16.70% |
| Dec 31, 2005 | 22.24% | 16.22% |
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), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Health Care)
Baxter International Inc., ROE, long-term trends, comparison to industry (health care)
| Baxter International Inc. | Health Care | |
|---|---|---|
| Dec 31, 2015 | 10.94% | 18.52% |
| Dec 31, 2014 | 30.75% | 19.17% |
| Dec 31, 2013 | 23.77% | 18.81% |
| Dec 31, 2012 | 33.53% | 18.20% |
| Dec 31, 2011 | 33.77% | 15.90% |
| Dec 31, 2010 | 21.62% | 14.85% |
| Dec 31, 2009 | 30.66% | 20.14% |
| Dec 31, 2008 | 32.33% | 20.29% |
| Dec 31, 2007 | 24.68% | 17.87% |
| Dec 31, 2006 | 22.27% | 20.49% |
| Dec 31, 2005 | 22.24% | 18.28% |
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), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).