Baxter Earns an A+ Rating

07/14/2014 8:00 am EST


A perpetual problem throughout the history of the stock market is that investors—both professional and individual—continue to be confounded by trying to time the market ‘s performance, observes Russ Kaplan, editor of Heartland Advisor.

My solution to this issue does not concern any graphics or mathematical algorithm. My solution to market timing throughout my investing career has been to not try to time it.

Instead, my focus is on buying undervalued stocks of solid companies regardless of market averages at any given time.

For me, it is important to make sure you invest in the right companies. Once you have a good stock, it is my job is to keep you invested for the long-run.

Is there still value in today's market? Yes, but we need to dig into the financial statements of potential stock picks to find the good investments. As such, I always spend a great deal of time doing intensive research before picking a good undervalued stock.

My newest recommendation is Baxter International (BAX). By whatever measure you care to use, Baxter is a financially solid company. In fact, it is one of a very few companies awarded a financial rating of A++ by Value Line.

This company pays an above average dividend of about 2.8%, way higher than the average stock, and much more than what you could get from a fixed income investment.

This stock has the capability of doing well independently, no matter what happens with regard to the Affordable Care Act.

An exciting development to me is that, within the course of the next year, Baxter is splitting into two independent companies, one for medical devices and one on biopharmaceuticals.

It’s BioScience Division is a global leader in manufacturing recombinant and plasma-based products that help individuals with a variety of bleeding and immune deficient disorders, burns, vaccines, and other products that deal with blood disorders.

Their Medical Device Division produces products that mix and package a variety of IV fluids as well as the apparatus to deliver the fluids to the patients.

Additionally, they are the leading producer of a variety of devices for home-based kidney treatment, they also provide services related to compounding for pharmacies, and other related services.

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