Raymond James raises Fulgent Genetics stock price target to $36 on strong performance
Investing.com -- Moody’s Ratings has downgraded Baxter International Inc.’s senior unsecured ratings to Baa3 from Baa2 and commercial paper rating to Prime-3 from Prime-2, with a stable outlook.
The downgrade reflects expectations for slower debt reduction due to several operational challenges. Baxter’s voluntary hold on Novum IQ infusion pumps in the US and Canada will likely continue beyond year-end 2025, while hospital conservation of IV solutions is expected to extend into 2026. The company also faces weaker demand for certain pre-mixed products in its Injectables & Anesthesia business.
Baxter has pushed back its target of reaching net debt/EBITDA of 3.0x from year-end 2025 to year-end 2026. As of September 30, Baxter’s Moody’s-adjusted gross debt/EBITDA stood at 5.2x, which Moody’s considers high despite significant debt reduction following asset sales.
The rating agency cited Baxter’s strong global scale and product diversity as positive factors, along with upcoming product launches expected to drive revenue growth. The company has also announced a significant reduction in shareholder dividends, which will save approximately $300 million annually and help reduce debt.
Moody’s noted that ESG considerations played a material role in the rating action, including responsible production issues related to the Novum IQ infusion pump and governance concerns about management credibility.
The stable outlook reflects Moody’s expectation that revenue will grow over the next 12-18 months and that management remains committed to reducing debt. Moody’s projects Baxter’s gross debt/EBITDA will decline toward 4.0x in 2026.
Factors that could lead to a future upgrade include sustained debt/EBITDA below 3.5x, while debt/EBITDA remaining above 4.0x could trigger a downgrade.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.