Daniel Loeb’s Third Point LLC disclosed Wednesday that he increased his stake in Baxter International Inc. (NYSE:BAX), a medical equipment and supplies company, by purchasing an additional 11.97 million shares at an average price of $32.69 per share.
After the transaction, the trader held 53.85 million shares. The stock has dropped 15.48% over the past year and traded around $32.85 per share by Wednesday closing, which was near its May price.
This new stake represents about 9.9% of the company’s outstanding common stock.
Third Point has reached an agreement with Baxter’s management that involves the appointment of Munib Islam, a partner at Third Point, to the company board of directors.
Conclusion
In the last quarter the company has performed well with EPS in the second quarter coming in at $1.00, beating estimates by 5 cents and revenues of $3.89 billion beating expectations by $120 million. Since Baxter International spun off Baxalta Inc. (NYSE:BXLT), Islam believes Baxter has the opportunity to focus on improving margins and increasing market share for the rest of its healthcare business
Baxter has a market cap of $17.92 billion and an enterprise value of $25.47 billion. It has a P/E of 8.23 lower than the industry median of 27.50, a P/B of 2.23 and a P/S of 1.09, lower than the industry median of 2.91. With 53.85 million shares in his portfolio, Dan Loeb is Baxter International’s leading shareholder among the gurus. The other guru holders of Baxter Incorporation are Richard Pzena (Trades, Portfolio), who holds 5.03 million shares; Tweedy Browne (Trades, Portfolio), who holds 2.54 million shares, followed by Charles Brandes, Mario Gabelli (Trades, Portfolio), John Rogers and John Keeley (Trades, Portfolio).
Note: The above chart is subject to copyright of Yahoo! Finance
