Here’s What Pressured Baxter International (BAX) in Q3

Pzena Investment Management recently released its third-quarter 2025 commentary for “Pzena Focused Value Strategy.” A copy of the letter can be downloaded here. Driven by optimism about AI and a September rate cut, US broad-based indexes surged in the third quarter. The technology sector was the strongest performer, with growth outpacing value. The Pzena Focused Value strategy gained but underperformed the Russell 1000 Value Index, returning 1.1% gross and 0.9% net vs. 5.3% for the index. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Pzena Focused Value Strategy highlighted stocks such as Baxter International Inc. (NYSE:BAX). Baxter International Inc. (NYSE:BAX) is a healthcare company that offers a portfolio of healthcare products. The one-month return for Baxter International Inc. (NYSE:BAX) was -2.89%, and its shares lost 41.42% over the last 52 weeks. On December 09, 2025, Baxter International Inc. (NYSE:BAX) stock closed at $18.48 per share, with a market capitalization of $9.335 billion.

Pzena Focused Value Strategy stated the following regarding Baxter International Inc. (NYSE:BAX) in its third quarter 2025 investor letter:

“The telecommunications, basic materials, and industrials sectors detracted from performance this quarter. Medical equipment manufacturer Baxter International Inc. (NYSE:BAX) posted a disappointing earnings report driven by a voluntary recall for a recent product launch and a slower-than-expected recovery in demand for IV fluids – the product line that was disrupted last year by Hurricane Helene. We expect these issues to be transitory and view the stock price reaction as disproportionate relative to the magnitude of the earnings pressure, and we added to our position. “

Is Baxter International Inc. (BAX) the Most Undervalued Healthcare Stock to Buy According to Analysts?

Baxter International Inc. (NYSE:BAX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 38 hedge fund portfolios held Baxter International Inc. (NYSE:BAX) at the end of the third quarter, up from 31 in the previous quarter. While we acknowledge the risk and potential of Baxter International Inc. (NYSE:BAX) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Baxter International Inc. (NYSE:BAX) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Baxter International Inc. (NYSE:BAX) and shared the list of top lowest P/E ratios of the S&P 500 in 2025. SCCM Enhanced Equity Income Fund sold its stake in Baxter International Inc. (NYSE:BAX) during Q3 2025. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.