Bayer (BAYRY) AI Stock Analysis

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Bayer

(OTC:BAYRY)

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Neutral 46 (OpenAI - 5.2)

Rating:46Neutral

Price Target:

$10.50

▼(-6.83% Downside)

Action:ReiteratedDate:03/06/26

The score is weighed down primarily by multi-year revenue decline, persistent net losses, and weakening cash flow, reinforced by earnings-call guidance for negative 2026 free cash flow and higher net debt tied to litigation. Technicals remain bearish (negative MACD; below short-term moving averages), while valuation is partially supported by the very high dividend yield but offset by loss-driven negative P/E risk.

Positive Factors

Diversified business model

Bayer's presence across pharmaceuticals, consumer health, crop science and animal health reduces reliance on any single market cycle. This multi‑stream model supports steadier revenues, cross‑segment R&D synergies and risk diversification that can sustain performance over the next 2–6 months.

Clinical & regulatory momentum in Pharma

A successful Phase III (OCEANIC‑STROKE) showing a 26% stroke reduction and Fast Track status is a structural win: it strengthens Bayer's late‑stage pipeline, accelerates regulatory timelines, and improves future commercial prospects and sustainable revenue growth beyond short‑term cycles.

Operational efficiency (DSO) and productivity gains

Concrete DSO savings (€700m in 2025; €2bn target) and organizational flattening are durable operational improvements. Lower structural costs and faster time‑to‑market raise sustainable margins and cash conversion, supporting long‑term competitiveness and funding capacity.

Negative Factors

Multi‑year revenue decline and net losses

Three straight years of falling revenue coupled with recurring net losses signals weakening core demand or portfolio challenges. Persistently negative profitability undermines return on invested capital, constrains reinvestment and raises execution risk for turning sales and margins around within the medium term.

Weakening cash generation

A sharp decline in operating cash flow and free cash flow reduces internal funding for R&D, capex and strategic initiatives. If this downtrend continues, it will materially limit financial flexibility and increase dependence on external financing during the next 2–6 months and beyond.

Large litigation liabilities and payout risk

Substantial litigation provisions (≈€11.8bn) and announced multi‑year payouts drive expected negative 2026 free cash flow and higher net debt. This structural legal burden will constrain capital allocation, raise refinancing and rating risk, and pressure balance‑sheet durability over the medium term.

Bayer (BAYRY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$43.71B

Dividend Yield0.29%

Average Volume (3M)295.44K

Price to Earnings (P/E)―

Beta (1Y)0.53

Revenue Growth-0.40%

EPS Growth66.67%

CountryUS

Employees90,587

SectorHealthcare

Sector Strength45

IndustryDrug Manufacturers - General

Share Statistics

EPS (TTM)0.18

Shares Outstanding3,929,696,000

10 Day Avg. Volume87,266

30 Day Avg. Volume295,443

Financial Highlights & Ratios

PEG Ratio-0.29

Price to Book (P/B)1.40

Price to Sales (P/S)0.83

P/FCF Ratio18.08

Enterprise Value/Market Cap1.57

Enterprise Value/Revenue1.51

Enterprise Value/Gross Profit2.56

Enterprise Value/Ebitda10.62

Forecast

1Y Price Target

$12.35

Price Target Upside9.58% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

EPS Forecast (FY)1.27

Revenue Forecast (FY)$53.06B

Bayer Business Overview & Revenue Model

Company DescriptionBayer 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.

How the Company Makes MoneyBayer generates revenue through multiple key streams across its business sectors. In pharmaceuticals, the company earns money from the sale of prescription drugs, including treatments for cardiovascular diseases, oncology, and women's health. The consumer health segment contributes by selling over-the-counter medications and health products. In the crop science division, Bayer profits from the sale of seeds, crop protection products, and digital farming solutions that enhance agricultural productivity. Additionally, Bayer's animal health segment generates revenue through veterinary products and services. The company also engages in strategic partnerships and collaborations, particularly in research and development, enhancing its product pipeline and market reach, which further contributes to its financial performance.

Bayer Key Performance Indicators (KPIs)

Any

EBITDA by Segment

EBITDA by Segment
Reveals the profitability of each business unit before interest, taxes, depreciation, and amortization, indicating which segments drive earnings and operational efficiency.

Chart InsightsBayer's Crop Science segment shows significant volatility, with recent quarters reflecting a downturn, possibly due to market pressures or strategic shifts. Pharmaceutical EBITDA has been relatively stable but shows a slight downward trend, indicating potential challenges in maintaining growth. Consumer Health remains consistent, suggesting resilience in this segment. Without recent earnings call insights, investors should monitor external factors affecting Crop Science and strategic moves in Pharmaceuticals to gauge future performance.

Data provided by:

The Fly

Bayer Earnings Call Summary

Earnings Call Date:Mar 04, 2026

(Q4-2025)

% Change Since: |

Next Earnings Date:May 12, 2026

Earnings Call Sentiment Neutral

The call balanced clear operational progress—delivery of raised guidance, improved launch momentum in Pharma, meaningful DSO-driven cost savings, and a reduced net financial debt position in 2025—against substantial legal and cashflow headwinds. Management articulated tangible growth drivers across Crop Science, Pharma and Consumer Health and concrete cost-savings milestones, but also disclosed large litigation provisions (EUR 11.8 billion liabilities), expected negative free cash flow in 2026 due to ~EUR 5 billion litigation-related payouts, projected net debt increase and significant product declines (notably Xarelto and Eylea). Given the mix of strong operational execution and material financial/legal risks that will weigh on near-term cash flow and balance-sheet metrics, the tone of the call is cautiously constructive but realistic about the challenges ahead.

Q4-2025 Updates

Positive Updates

Delivered Raised Guidance and Full-Year Results

Currency- and portfolio-adjusted group net sales of EUR 45.5 billion for 2025; group net sales grew ~1% year-over-year on a currency- and portfolio-adjusted basis. Core earnings per share (reported definition) of EUR 4.91 and group EBITDA before special items of EUR 9.7 billion. Free cash flow of EUR 2.1 billion (upper end of guidance).

Improved Balance Sheet Position in 2025

Net financial debt reduced to below EUR 30 billion at end of 2025 (helped by free cash flow and ~EUR 1.4 billion FX tailwind), and core financial result improved due to lower interest expenses and positive equity-result changes.

Dynamic Shared Ownership (DSO) Cost Savings and Productivity Gains

DSO delivered an additional EUR 700 million of cost reductions in 2025; total savings through DSO expected to reach EUR 2 billion by the end of the year. Organizational flattening: roughly half as many layers and management reduced by ~2/3 vs. program start, enabling faster product launches and increased agility.

Crop Science: Licensing Windfall and Strong Seed/Trait Performance

Licensing resolutions with Corteva contributed ~EUR 300 million to Q4 2025 corn performance and ~EUR 450 million expected to support soy in Q1 2026. Corn seeds & traits benefited from historically high North American acreage and strong global performance; core Crop Science growth outlook of 1%–4% in 2026 and expected EBITDA margin (before special items) of 20%–22%.

Robust Pharma Launch Momentum

Launch products (Nubeqa, Kerendia, Beyonttra, Lynkuet) showed strong momentum in 2025. Company expects Nubeqa and Kerendia to grow ~50% in 2026 (constant currency). Pipeline progress included 16 clinical programs advanced and five new approvals/key indications in 2025.

Consumer Health Resilience and Strategic Focus

Consumer Health delivered stable net sales year-over-year in 2025 despite softness in the U.S. and China. 2026 guidance anticipates net sales growth of 0%–4% (currency and portfolio adjusted) and EBITDA margin before special items of 22%–24%, driven by Road to Billion strategy, e-commerce and AI investments.

Operational Transformation Enabling Faster Time-to-Market

DSO and other reorganizations shortened time-to-market for new products (examples: record launch speeds in Pharmaceuticals and <1-year launch cycles cited for some Consumer Health products), supporting faster commercialization of innovations.

Negative Updates

Large Litigation-Related Costs and Provisions

Litigation-related special items of EUR 7.5 billion in 2025; total litigation-related provisions and liabilities assessed at EUR 11.8 billion covering known and reliably forecast costs (including past glyphosate verdicts).

2026 Negative Free Cash Flow and Financing Impact

Outlook for 2026 free cash flow of negative EUR 1.5 billion to negative EUR 2.5 billion driven by an expected litigation-related payout of around EUR 5 billion. Net financial debt projected to increase to EUR 32–33 billion (constant currencies).

Reported Earnings Pressures and One-Offs

Reported earnings per share were negative at minus EUR 3.68 in 2025, driven by amortization of intangibles, significant litigation-related provisions and liabilities classified as special items. Methodology change for core EPS (including certain amortization) causes an approximate EUR 0.35 step-down in the 2025 comparable core EPS (adjusted core EPS ~EUR 4.57).

Foreign Exchange and Geopolitical Headwinds

Material FX headwinds of about EUR 1.7 billion in 2025 (U.S. dollar, Brazilian real and hyperinflation currencies) and an anticipated FX headwind of ~EUR 0.30 to core EPS for 2026. Management highlights continued volatility from tariffs, FX and geopolitics as major swing factors.

Product-Specific Declines and Regulatory Pressure

Expected significant declines for key legacy products: Xarelto decline of roughly 35%–40% in 2026 (generic pressure accelerating); Eylea franchise decline ~20%–25% in 2026 (biosimilar entry); glyphosate sales expected to decrease ~2%–6% year-over-year due to tariff reductions and generic price declines. Crop Science faced regulatory headwinds (dicamba label vacatur, Movento expiration) and EU regulatory pressure impacting protection portfolio.

Consumer Health Market Softness in Key Markets

Consumer Health categories, especially nutritionals and seasonal cough/cold/allergy, were negatively impacted by market softness in the U.S. and China, inventory destocking and weaker seasonality, constraining short-term growth in 2025 and 2026.

Ratings and Funding Uncertainty

Negative outlook remains with rating agencies given litigation-related payout and projected increase in net financial debt; management expects to use debt instruments and equity-credit receiving structures for financing, but 2026 outlook conservatively reflects straight debt, creating short-term rating and funding risk.

Company Guidance

Bayer's 2026 guidance (at constant currencies) targets group net sales of €45–47bn, EBITDA before special items of €9.6–10.1bn (≈ -1% to +4% y/y) and core EPS of €4.30–4.80 (after a 2025 core‑EPS methodology change that adjusts 2025 from €4.91 to €4.57, a ~€0.35 step‑down); the company expects negative free cash flow of about -€1.5bn to -€2.5bn due to an anticipated ~€5bn litigation payout and forecasts net financial debt rising to €32–33bn (from <€30bn at end‑2025), with FX headwinds of ~€0.30 on core EPS. Division-level guidance includes Crop Science core growth of 1–4% c/p‑adj and an EBITDA margin before special items of 20–22% (glyphosate sales -2% to -6%; Corteva‑related licensing supported ~€300m in Q4‑25 and ~€450m in Q1‑26), Pharmaceuticals revenue 0–3% with Nubeqa/Kerendia growth ~50%, Xarelto -35% to -40% and Eylea -20% to -25% and a Pharma margin of 23–25%, and Consumer Health sales 0–4% with a margin of 22–24%. Management also reiterated DSO savings of ~€700m in 2025 and cumulative DSO savings of €2bn by year‑end, reported litigation‑related special items of €7.5bn and litigation provisions/liabilities of €11.8bn, and said financing is planned via senior bonds and instruments that can receive equity credit.

Bayer Financial Statement Overview

Summary

Income statement weakness dominates: revenue has fallen for three straight years and net income is negative in 2023–2025 despite a rebound in EBIT in 2025. Balance sheet remains leveraged with declining equity over time, though debt has eased versus 2023. Cash flow is still positive, but operating cash flow and free cash flow fell sharply in 2025, raising durability concerns.

Income Statement

Negative

Revenue has declined for three consecutive years (2023–2025), and profitability has deteriorated materially: net income is negative in 2023–2025 (2025: -$3.5B; 2024: -$2.6B; 2023: -$2.9B). While gross profit remains sizable (2025: ~$25.9B on ~$43.8B revenue), the company has struggled to translate that into bottom-line earnings, indicating heavy operating/non-operating burdens. A key positive is improved operating profit versus 2023 (EBIT rebounds to ~$6.7B in 2025 from slightly negative in 2023), but the sustained losses and shrinking top line keep the income statement score low.

Balance Sheet

Neutral

The asset base is large (2025 total assets: ~$110.6B) with meaningful equity (2025: ~$25.9B), but leverage is elevated and equity has been trending down (from ~$38.8B in 2022 to ~$25.9B in 2025). Debt has eased versus 2023 (down from ~$44.8B to ~$37.4B in 2025), which is constructive, yet prior years show high debt relative to equity (e.g., debt-to-equity ~1.27x in 2024 and ~1.36x in 2023). Negative returns on equity in 2023–2024 reflect weak earnings power and pressure on balance-sheet quality despite the modest deleveraging.

Cash Flow

Neutral

Cash generation is positive but weakening: operating cash flow fell to ~$4.4B in 2025 from ~$7.4B in 2024, and free cash flow dropped to ~$2.0B from ~$4.6B (2025 free cash flow down ~46% YoY). The company has consistently produced positive operating cash flow and free cash flow across the period shown, which helps offset reported accounting losses in several years, but the recent decline raises concern about durability and financial flexibility if the downtrend continues.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	43.78B	46.61B	47.64B	50.74B	44.08B
Gross Profit	25.92B	25.34B	27.89B	30.87B	27.27B
EBITDA	10.57B	8.81B	4.21B	10.44B	6.97B
Net Income	-3.48B	-2.55B	-2.94B	4.15B	1.00B
Balance Sheet
Total Assets	110.56B	110.85B	116.26B	124.88B	120.24B
Cash, Cash Equivalents and Short-Term Investments	7.85B	8.09B	10.59B	10.15B	7.74B
Total Debt	37.43B	40.70B	44.79B	41.65B	39.53B
Total Liabilities	84.51B	78.81B	83.18B	85.95B	87.07B
Stockholders Equity	25.94B	31.91B	32.93B	38.77B	33.02B
Cash Flow
Free Cash Flow	2.00B	4.59B	2.37B	4.14B	2.48B
Operating Cash Flow	4.39B	7.37B	5.12B	7.09B	5.09B
Investing Cash Flow	-1.55B	164.00M	-4.01B	-2.38B	855.00M
Financing Cash Flow	-2.10B	-7.18B	-679.00M	-4.22B	-5.64B

Bayer Technical Analysis

Technical Analysis Sentiment

Negative

Last Price11.27

Price Trends

50DMA

12.42

Negative

100DMA

10.87

Positive

200DMA

9.44

Positive

Market Momentum

MACD

-0.37

Positive

RSI

40.20

Neutral

STOCH

36.92

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BAYRY, the sentiment is Negative. The current price of 11.27 is below the 20-day moving average (MA) of 11.53, below the 50-day MA of 12.42, and above the 200-day MA of 9.44, indicating a neutral trend. The MACD of -0.37 indicates Positive momentum. The RSI at 40.20 is Neutral, neither overbought nor oversold. The STOCH value of 36.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BAYRY.

Bayer Peers Comparison

Overall Rating

UnderperformOutperform

Sector (51)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GILD	74 Outperform	$170.34B	17.94	41.01%	2.52%	2.76%	6407.19%
BMY	71 Outperform	$117.06B	15.61	39.27%	4.84%	1.26%	―
SNY	69 Neutral	$108.56B	-31.42	14.71%	4.58%	-9.32%	120.62%
GSK	67 Neutral	$104.09B	13.19	37.19%	3.41%	5.97%	128.66%
PFE	64 Neutral	$153.36B	18.21	8.67%	6.65%	4.44%	128.96%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
BAYRY	46 Neutral	$43.71B	-10.41	-12.24%	0.29%	-0.40%	66.67%

* Healthcare Sector Average

Performance Comparison

BAYRY

Bayer

11.08

4.60

70.87%

BMY

Bristol-Myers Squibb

57.48

-0.65

-1.12%

GILD

Gilead Sciences

137.21

32.90

31.55%

GSK

GlaxoSmithKline

51.84

14.10

37.37%

PFE

Pfizer

26.97

2.47

10.08%

SNY

Sanofi

44.60

-10.54

-19.12%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Mar 06, 2026