NEW YORK (CNN/Money) - A sales shortfall from Baxter International sent shares of the maker of intravenous solutions, dialysis equipment, and blood-collection containers tumbling as much as 31 percent Thursday afternoon.

Baxter said second-quarter sales grew 8 percent to $2.02 billion. That's 4 percent below the $2.107 billion expected by analysts, according to First Call.

Daniel T. Lemaitre, who follows Baxter for Merrill Lynch, expected 13 percent sales growth from Baxter (BAX: Research, Estimates), whose June quarter profit fell 21 percent, matching forecasts.

"In light of the shortfall and this skittish market, we are downgrading our intermediate-term rating on (Baxter) from "strong buy" to "buy," Lemaitre told clients.

Shares of Baxter, the biggest loser on the New York Stock Exchange, fell as low as $30.03, down $13.40 from Wednesday's $43.41 close.

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Baxter reported net earnings of $200 million, or 32 cents a share. That's down 21 percent from $253 million, or 42 cents per share, a year ago. The results include two special charges that reduced Baxter's earnings by 16 cents per diluted share.

The company, based in Deerfield, Ill., said sales of Baxter's recombinant Factor VIII therapy used in the treatment of hemophilia rose more than 25 percent.

But Merrill's Lemaitre said weakness in its renal and bioscience division contributed to the shortfall.

Not all analysts were downbeat.

David Lothson, who covers the company for UBS Warburg, raised his rating on Baxter to "strong buy" from "hold," saying the selloff has created an opportunity.

"In view of the extraordinary sell-off in Baxter shares, we are upgrading our rating," Lothson said in a note. "We believe investors have overreacted to weakness in the company's second-quarter Bioscience revenues."

Looking ahead, Baxter said it expects to meet its 2002 sales targets of growth in the low teens and earnings per share growth in the mid-teens.

"Our business fundamentals remain strong," Baxter CEO Harry M. Jansen Kraemer Jr. said in a statement. "With continued strong sales of Medication Delivery products and Recombinate hemophilia therapy, as well as improvements in BioScience production yields and cycle times, we expect our sales growth to accelerate in the second half of this year."