) from its recommended list, and now rates it as market outperform.
Analyst Lawrence Keusch says second quarter earnings per share excluding charges were in line with estimates, but he says the $2.02 billion sales figure was $70 million below his estimate, primarily due to weaker than expected results in its BioSciences (plasma; 37% of revenues) and Renal (dialysis equipment; 25% of revenues) divisions.
Keusch thinks 2002 guidance will be back-end loaded; Renal sales are likely to be flat for the year. He thinks Baxter will need to use gains from a currency translation to meet its low-teens sales growth target for the year. Keusch also thinks a lack of near-term catalysts is likely to plague the stock.