Is Baxter International, Inc. overvalued or undervalued?

As of 8 February 2024, Baxter International, Inc. has moved from an expensive to a risky valuation grade. The company is currently considered overvalued based on its financial metrics. Key ratios include a P/E ratio of 31, an EV to EBITDA of 16.08, and a Price to Book Value of 2.94, which are significantly higher than some of its peers. For instance, Agilent Technologies, Inc. has a P/E ratio of 25.22 and an EV to EBITDA of 18.77, while GE Healthcare Technologies, Inc. shows a much lower P/E of 13.75, indicating that Baxter's valuation is not justified when compared to these competitors.
Additionally, Baxter's return metrics are concerning, with a 1-year stock return of -12.54% compared to a 10.26% return for the S&P 500, suggesting underperformance. With a dividend yield of 1.95% and a ROE of 9.41%, the company does not provide compelling value relative to its peers, reinforcing the conclusion that it is overvalued in the current market context.