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1. Company Snapshot

1.a. Company Description

Bayer Aktiengesellschaft, together its subsidiaries, operates as a life science company worldwide.It operates through Pharmaceuticals, Consumer Health, and Crop Science segments.The Pharmaceuticals segment offers prescription products primarily for cardiology and women's health care; specialty therapeutics in the areas of oncology, hematology, and ophthalmology; and diagnostic imaging equipment and contrast agents, as well as cell and gene therapy.


The Consumer Health segment markets nonprescription over-the-counter medicines, medical products, medicated skincare products, nutritional supplements, and self-care solutions in dermatology, nutritional supplements, pain and cardiovascular risk prevention, digestive health, allergy, and cold and cough.The Crop Science segment offers chemical and biological crop protection products, improved plant traits, seeds, digital solution, and pest and weed control products, as well as customer service for agriculture.This segment also provides breeding, propagation, and production/processing of seeds, including seed dressing.


The company has a collaboration agreement with MD Anderson Cancer Center to develop oncology drugs; research and license agreement with Dewpoint Therapeutics, Inc.for the development of new treatments for cardiovascular and gynecological diseases; collaboration agreement with Exscientia Ltd, Foundation Medicine Inc., and Evotec AG; research collaboration with Arvinas Inc.; strategic research partnership with University of Oxford to develop novel gynecological therapies; and Kyoto University to identify new drugs candidates for the treatment of pulmonary diseases.It distributes its products through wholesalers, pharmacies and pharmacy chains, supermarkets, online and other retailers, and hospitals, as well as directly to farmers.


Bayer Aktiengesellschaft was founded in 1863 and is headquartered in Leverkusen, Germany.

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1.b. Last Insights on BAYN

Breaking News: Bayer Aktiengesellschaft shares rose as much as 14% after the US Solicitor General supported the company's push for the Supreme Court to review rulings on its Roundup weedkiller case. The company is facing over 67,000 US lawsuits alleging Roundup causes cancer, which Bayer denies. The US government endorsement of a legal appeal boosted investor confidence. No recent earnings release was available. Analysts at Deutsche Bank recommend a hold on Bayer, while analysts at UBS recommend a buy. The company has paid out about $10 billion to plaintiffs who claimed Roundup's main ingredient caused their cancer.

1.c. Company Highlights

2. Bayer's Q3 2025 Earnings: A Mixed Bag

Bayer reported a slight increase in Q3 2025 sales, with currency and portfolio-adjusted growth up 1% to EUR 11.4 billion. Core EPS was EUR 4.29, up 7% from last year. However, free cash flow was negative EUR 800 million, in line with projections. The company's EBITDA margin before special items was 25.7% or EUR 363 million, in line with last year. The actual EPS was not directly comparable to estimates, but the reported core EPS indicates a solid performance.

Publication Date: Nov -14

📋 Highlights
  • Core EPS Growth:: Core EPS rose 7% to EUR 4.29, driven by improved operational performance and higher sales.
  • Pharmaceuticals Growth:: Nubeqa and Kerendia surged 56% and 85% respectively, offsetting Eylea’s 11% decline due to pricing pressure.
  • Consumer Health Challenges:: Flat year-over-year sales in Q3 despite 2% growth, with key markets (U.S., China) underperforming due to consumer confidence issues.
  • Litigation Impact:: Increased provision following an adverse PCB Erickson verdict, though management remains confident in risk mitigation strategies.
  • 2026 Outlook:: Expected Pharmaceuticals expansion from Lynkuet and Crop Science glyphosate-driven growth, with EMEA/LATAM markets recovering post-weakness.

Segment Performance

Crop Science sales were up 1% to EUR 3.9 billion, driven by strong demand for corn and Crop Protection. Pharmaceuticals sales were at the prior year's level, with EUR 4.3 billion, driven by strong growth from Nubeqa and Kerendia. Nubeqa increased 56%, and Kerendia grew 85%, mainly driven by the U.S. and China. Consumer Health sales grew 2% in Q3, with flat absolute sales year-over-year.

Outlook and Guidance

The company confirmed its full-year free cash flow outlook and expects to deliver its 2025 group guidance. For 2026, Bayer looks forward to continued growth from Nubeqa, Kerendia, and new products. The company remains confident in its dynamic shared ownership system delivering efficiency gains. Bayer expects low single-digit growth in the U.S. and China, and 3-5% growth globally in Consumer Health.

Valuation and Ratios

With a P/E Ratio of -8.33 and an EV/EBITDA of 9.52, Bayer's valuation appears to be influenced by its current earnings challenges. The company's ROE is -10.91%, indicating a negative return on equity. However, the ROIC is 6.94%, suggesting that the company's invested capital is generating a positive return. The Net Debt / EBITDA ratio is 5.17, indicating a significant debt burden.

Litigation and Regulatory Updates

Bayer's litigation provision increased due to various factors, including an adverse verdict in the PCB Erickson case. The company considers further legal options and continues to work towards containing litigation risk. The company is also working on a multi-pronged approach to resolve the glyphosate case in front of the US Supreme Court.

Operational Updates

The company has made significant progress in its DSO (Dynamic Shared Ownership) initiative, with headcount reduction from 15,000 to 5,000 managers and layers reduced from 11-12 to 6-7. Bayer expects continued reduction in total headcount numbers but at a slower rate. The company is also optimistic about the launch of new products, including Lynkuet and Beyonttra.

3. NewsRoom

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Evotec-Partner Bayer Starts Phase 2 Study for Treatment of Patients with Alport Syndrome

Dec -04

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Bayer Starts Phase IIa Study for Treatment of Patients With Alport Syndrome

Dec -04

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RSNA25: Pediatric Study for Bayer's Investigational MRI Contrast Agent Gadoquatrane Meets Primary and Secondary Endpoints

Dec -03

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Bayer Stock Up as Government Backs Supreme Court Review in Roundup Case

Dec -03

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United States Radiation Dose Management Market Report 2025-2033: Growth Driven by Expanding Healthcare Infrastructure, Rising Chronic Illness Burden, and Increasing Adoption of Dose Monitoring Systems

Dec -03

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Here's Why the Maker of Roundup Weed Killer's Stock Is Surging Today

Dec -02

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Bayer Stock Jumps After White House Backs Supreme Court Weedkiller Review

Dec -02

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Bayer Stock Jumps After White House Backs Supreme Court Weedkiller Review

Dec -02

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.34%)

6. Segments

Crop Science

Expected Growth: 4.0%

Crop Science's 4.0 growth is driven by innovative solutions like precision farming, digitalization, and sustainable agriculture practices. Strong demand for food security and efficient resource use fuels growth. Bayer's robust pipeline of seeds, traits, and crop protection products, along with strategic acquisitions, also contribute to the segment's expansion.

Pharmaceuticals

Expected Growth: 2.5%

Bayer AG's pharmaceutical segment growth of 2.5% is driven by strong sales of key products like Xarelto and Eylea, as well as a robust pipeline of new medicines. Additionally, strategic acquisitions and partnerships have expanded its portfolio, contributing to revenue growth. Operational efficiencies and cost management have also supported the segment's performance.

Consumer Health

Expected Growth: 3.5%

Bayer AG's Consumer Health segment growth of 3.5% is driven by: strong demand for over-the-counter (OTC) medications, particularly pain relief and digestive health products; strategic acquisitions and partnerships; and increased focus on self-care and preventive healthcare. Expansion in emerging markets and digitalization of sales channels also contribute to growth.

All Other

Expected Growth: 1.5%

All Other segment growth at 1.5% driven by steady performance in Animal Health and Consumer Health businesses, with slight increase in Crop Science-related activities. Growth primarily attributed to strong sales in emerging markets and new product launches, offset by currency headwinds and competition.

Enabling Functions and Consolidation

Expected Growth: 0.0%

Bayer AG's Enabling Functions and Consolidation segment growth is driven by efficient resource allocation, streamlined operations, and synergies from integrating acquired businesses. The 0.0% growth rate suggests a stable segment, possibly due to optimization efforts and cost savings, which offset potential revenue increases, reflecting a strategic focus on consolidation and efficiency gains.

7. Detailed Products

Aspirin

A pain reliever and antipyretic medication

Xarelto

An oral anticoagulant medication

Xofigo

A radiopharmaceutical for the treatment of prostate cancer

Kogenate

A recombinant factor VIII for the treatment of hemophilia A

Crop Science Products

A range of crop protection products, seeds, and traits

Confidor

An insecticide for controlling pests in crops

Larvin

A biological insecticide for controlling pests in crops

Advantix

A topical insecticide and acaricide for dogs

Drontal

An anthelmintic for the treatment of parasitic infections in animals

8. Bayer Aktiengesellschaft's Porter Forces

Forces Ranking

Threat Of Substitutes

Bayer Aktiengesellschaft operates in a highly competitive industry, and there are many substitutes available for its products. However, the company's strong brand recognition and customer loyalty mitigate the threat of substitutes to some extent.

Bargaining Power Of Customers

Bayer Aktiengesellschaft's customers are largely fragmented and lack the bargaining power to negotiate prices or terms. The company's strong brand recognition and customer loyalty also reduce the bargaining power of customers.

Bargaining Power Of Suppliers

Bayer Aktiengesellschaft relies on a diverse range of suppliers for its raw materials and services. While some suppliers may have bargaining power, the company's scale and diversification of suppliers mitigate this risk.

Threat Of New Entrants

The pharmaceutical and life sciences industry has high barriers to entry, including significant research and development costs, regulatory hurdles, and the need for specialized expertise. This limits the threat of new entrants.

Intensity Of Rivalry

The pharmaceutical and life sciences industry is highly competitive, with many established players competing for market share. Bayer Aktiengesellschaft faces intense competition from rivals such as Pfizer, Novartis, and Roche.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 57.11%
Debt Cost 3.95%
Equity Weight 42.89%
Equity Cost 8.78%
WACC 6.02%
Leverage 133.16%

11. Quality Control: Bayer Aktiengesellschaft passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Novartis

A-Score: 6.3/10

Value: 3.5

Growth: 4.2

Quality: 7.8

Yield: 7.5

Momentum: 5.5

Volatility: 9.3

1-Year Total Return ->

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GSK

A-Score: 5.7/10

Value: 3.9

Growth: 2.2

Quality: 6.5

Yield: 6.9

Momentum: 7.5

Volatility: 7.3

1-Year Total Return ->

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Sanofi

A-Score: 5.7/10

Value: 5.7

Growth: 4.0

Quality: 8.0

Yield: 7.5

Momentum: 1.5

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
AstraZeneca

A-Score: 5.5/10

Value: 2.0

Growth: 7.6

Quality: 6.9

Yield: 3.1

Momentum: 6.5

Volatility: 7.0

1-Year Total Return ->

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Stock-Card
Roche

A-Score: 5.3/10

Value: 2.0

Growth: 3.0

Quality: 6.4

Yield: 6.2

Momentum: 6.0

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Bayer

A-Score: 4.5/10

Value: 8.1

Growth: 2.1

Quality: 2.5

Yield: 3.8

Momentum: 6.5

Volatility: 4.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

33.3$

Current Price

33.3$

Potential

-0.00%

Expected Cash-Flows