Sunday, February 22, 2015

Recent Buy

I wasn't really sure if I would be able to make any purchases this month. My big trip to New Zealand is coming up and I am going to be strapped for cash for a while. I do have a goal to make up my vacation costs but I am also fronting the money and my girlfriend will pay me back after she starts her new job. So, while I have plans to cover all these extra expenses, they won't come to fruition for until much later in the year leaving me short on cash at the moment.

Despite all this I did end up making a purchase and I think my cash situation will work out just fine. I purchased 30 shares of BAX at $66.7673 on Friday.

From Scottrade:
Baxter International Inc. (Baxter) is a global, diversified healthcare company. Baxter, through its subsidiaries, develops, manufactures and markets products that save and sustain the lives of people with hemophilia, immune disorders, infectious diseases, kidney disease, trauma, and other chronic and acute medical conditions. The Company operated in two segments: BioScience and Medication Delivery. It is engaged in the medical devices, pharmaceuticals and biotechnology to create products that advance patient care worldwide. These products are used by hospitals, kidney dialysis centers, nursing homes, rehabilitation centers, doctors’ offices, clinical and medical research laboratories, and by patients at home under physician supervision.
 Baxter International's peers include Johnson and Johnson (JNJ) and Pfizer, Inc (PFE). Below is a quick comparison between these three companies:

Symbol P/E % Yield Years of
Dividend Growth
5 yr Div
Growth Rate
10 yr Div
Growth Rate
  BAX 19.1     3.06               8       17.7%       14.2%
   JNJ 17.6     2.78             52         7.0%         7.4%
  PFE 24.4     3.25              5         9.1%         5.4%

Obviously BAX does not have a long history of dividend growth but  since initiating a divided BAX has had a great dividend growth rate. One additional selling point is the plan to spin off the biotech side of the company leaving BAX to focus on medical technology. BAX has had a history of good spinoffs, which My Dividend Growth just wrote about.

I saw an opportunity to buy into a company I have had my eye on and I took it. BAX does not have a long history of dividend growth but has been increasing the dividend steadily over the last 8 years. While BAX does not have a long history of dividend growth it has had success with spinoffs in the past and I saw the upcoming spinoff as a potential for some added value.

What do you think? Do you own BAX?

Photo Credit:

1 comment:

  1. Best of luck with the trade and your trip. Hopefully your gf pays u back. I seen that scenario go wrong on judge judy all the time lol.