Here’s Why You Should Consider Selling Your Baxter (BAX) Shares

Parnassus Investments, an investment management firm that focuses on owning a concentrated portfolio of U.S. large-cap stocks, released its Parnassus Value Equity Fund second-quarter 2025 investor letter. The full letter is available for download here. For the second quarter of 2025, the fund reported a net return of 7.24%, outperforming its benchmark, the Russell 1000 Value Index, which returned 3.79% for the same period. The fund’s top 5 holdings are also listed in the letter, showing the firm’s main investment positions heading into 2025.

One of the companies mentioned in the letter is Baxter International Inc. (NYSE:BAX). Baxter International Inc. (NYSE:BAX), through its subsidiaries, provides a portfolio of healthcare products in the United States. Over the past month, Baxter International Inc. (NYSE:BAX) fell by -16.45%, and its shares lost 35.47% of their value over the last 12 months. On August 12, 2025, Baxter International Inc. (NYSE:BAX) shares closed at $23.98, with a market capitalization of $12.3 billion.

Here is what they have to say about Baxter International Inc. (NYSE:BAX) in their investor letter:

Despite Baxter International Inc.’s (NYSE:BAX) defensive characteristics, we became concerned about its capital allocation decisions, recent management changes and sensitivity to hospital budgets. We traded Baxter for Linde, where we see higher long-term risk-reward potential.”

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A patient viewing their medical diagnosis on a digital healthcare ecosystem.

Baxter International Inc. (NYSE:BAX) is not included in our list of the 30 most popular stocks among hedge funds. According to our data, 36 hedge fund portfolios held positions in Baxter International Inc. (NYSE:BAX) at the end of the first quarter of 2025, same with the previous quarter. BAX misses on earnings expectations as it reported an EPS of $0.59, missing expectations of $0.6. While we acknowledge the risk and potential of 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 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 Artisan Partners’ views on the company. In addition, please check out our hedge fund investor letters Q2 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.