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Baxter Raises Guidance As Hospital Market Rebounds; Stock Hits High

Shares of medical-product maker Baxter International ( BAX ) hit an all-time high Tuesday after the company beat Q1 estimates and raised its guidance. Baxter’s earnings, excluding one-time items, rose 6% over the year-earlier quarter to 36 cents a share, beating analysts’ consensus by seven cents, according to Thomson Reuters. Sales declined 1% to $2.38 billion, beating Wall Street’s number by about $22 million. Excluding the foreign-exchange impact, sales rose 4%. Baxter added 13 cents to its full-year EPS guidance, now $1.59 to $1.67, up from $1.36 last year. The company said that its constant-currency sales growth should be 3%; it had previously guided 2% to 3%. For the second quarter, Baxter forecast earnings of 38 to 40 cents a share, topping analysts’ average estimate of 35 cents. It said that sales should grow 2% — even including the FX impact — where the Street had expected a slight decline. Baxter stock hit a new high of 44.75 in early trading on the stock market today . In afternoon trading, shares were up less than 1%, near 44. Baxter’s products, which include IV systems, dialysis machines and surgical equipment, are sold mainly to the hospital market, which has been looking strong this earnings season, according to Leerink analyst Danielle Antalffy. “This — now the third consecutive growth quarter in the U.S. after two consecutive quarters of low-single-digit declines — could serve as another encouraging data point, in addition to Johnson & Johnson ( JNJ ), St. Jude Medical ( STJ ) and Abbott Laboratories ( ABT ) (Q1 reports) last week, that supports a potential trend for improving U.S. procedure volumes overall,” Antalffy wrote in a research note. The fortunes of hospital stocks supports her view: The Medical-Hospitals group has been among the fastest-rising of IBD’s 197 industry groups, leaping from No. 191 to six weeks ago to No. 39 at present.

Google Transparency Project Sees Google-Government ‘Revolving Door’

Google, the search leader and main company of parent firm Alphabet ( GOOGL ), has outsized influence on government officials and public policies, says the nonprofit Google Transparency Project, which launched a searchable database on the issue on Tuesday. Google Transparency Project is a research initiative of Campaign for Accountability, which says that it “uses research, litigation and aggressive communications to expose how decisions made behind the doors of corporate boardrooms and government offices impact Americans’ lives.” The group said in a statement , “The project will compile and organize data from public sources and make it available for (public) review.” “Google knows more about us than we know about ourselves, but we know surprisingly little about Google and how it actually operates,” Anne Weismann, executive director of Campaign for Accountability, said in the statement. “Google has long been a strong advocate of transparency in government, business and even users’ private lives. It has not, however, been transparent about its own dealings with the government.” Weismann said that the new project “will shine a light on how Google influences our government officials, public policies and the way we live.” When contacted by IBD, an official with the nonprofit said that it does not reveal its funding sources. “We do not disclose our donors,” said Daniel Stevens, Campaign for Accountability deputy director. “I cannot comment on any aspect of it. For 501(c)(3) (nonprofits), we have to disclose it (funding sources) to the IRS, but it’s not something that has to be publicly available.” The group’s first data release says that 427 meetings involving Google’s employees or associated entities have occurred since President Barack Obama took office in January 2009 through October 2015 — more than one a week. The project also sees a “revolving door,” with some employees moving from Google to government jobs and vice versa. “The data set highlights the astonishing level of traffic between the two in both directions: 251 people either moved from Google into government or vice versa since Obama took office,” according to the group’s statement. Weismann served as chief counsel of Citizens for Responsibility and Ethics in Washington and as deputy chief of the Federal Communications Commission’s Enforcement Bureau, where she had responsibility for the bureau’s telecom matters. Alphabet stock was near 733, down more than 1% in afternoon trading on the stock market today .

Have 3D Systems, Stratasys Stocks Traveled Too Far Too Fast?

With a strong leap in the stock prices of 3D Systems ( DDD ) and Stratasys ( SSYS ), some analysts question if the rise was too far too fast. Needham analyst James Ricchiuti on Tuesday lowered his rating on 3D Systems to hold from buy, saying further upside in the stock over the near term will be challenging. He says the turnaround at 3D Systems should be more gradual than the market is anticipating. It follows a recent downgrade of 3D Systems and Stratasys from Citi based on stock price valuations of both companies. Shares of 3D Systems and Stratasys were hammered in 2015 as both posted quarter after quarter of disappointing earnings and sales. This year, Stratasys stock has nearly doubled since hitting a six-year low of 14.88 three months ago. 3D Systems has nearly triple since hitting a five-year low of 6 three months ago. “3D Systems shares are now above our 12-month target price,” Ricchiuti wrote in a research note. “With the stock trading at 32 times our 2017 EPS estimate, the market appears to be pricing healthy upside to estimates.” The rise of both stocks were partly fueled by the Q4 earnings reports of both companies that beat expectations, suggesting the worst might be over and raising hopes the top two 3D printer makers are poised for a rebound. But that wasn’t the message that 3D Systems and Stratasys tried to signal, as comments from company executives during the conference call were of a cautious tone about the road ahead. 3D Systems got a further bounce when it announced Vyomesh Joshi as CEO on April 4. Joshi had been executive vice president of the imaging and printing business of HP Inc. ( HPQ ), formerly Hewlett-Packard before its split. HP plans to enter the 3D printer market this year. 3D Systems stock was near 18, down 2%, in afternoon trading in the stock market today . Stratasys was trading near 26, up a fraction. 3D Systems is set to report first-quarter earnings on May 5 and Stratasys on May 9, both before the market open. The consensus on 3D Systems is revenue of $156.3 million, down 3% year over year, and earnings per share minus items of 5 cents, flat, as polled by Thomson Reuters. Stratasys sales are seen rising 4.5% to $164.8 million as it swings to a 4-cent per-share loss from a 4-cent profit. “Notwithstanding solid sequential improvement in Q4 from eight of the publicly traded 3D printing companies, we believe business remains challenging compounded by the normal seasonal weakness experienced in the March quarter,” Ricchiuti wrote.