Bayer (BAYN) AI Stock Analysis

• Market Cap: €26.50B
• Dividend Yield: 0.36%
• Average Volume (3M): 3.23M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.93
• Revenue Growth: -0.92%
• EPS Growth: -4.30%
• Country: DE
• Employees: 90,587
• Sector: Healthcare
• Sector Strength: 42
• Industry: Drug Manufacturers - General
• EPS (TTM): 2.49
• Shares Outstanding: 982,424,100
• 10 Day Avg. Volume: 2,775,457
• 30 Day Avg. Volume: 3,231,955
• PEG Ratio: 0.29
• Price to Book (P/B): 0.80
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.93
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €27.58
• Price Target Upside: 2.22% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13

• Rating: 62 Neutral
• Price Target: €28.00 ▲(3.78%Upside)

Bayer's overall stock score is primarily influenced by positive cash flow management and technical indicators suggesting moderate bullish momentum. However, challenges in profitability and a negative P/E ratio weigh down the score. The insider purchase by a board member provides a positive outlook, enhancing investor confidence.

Positive Factors

Cash Flow

The company has implemented measures to maximize cash flow generation, which is crucial given the high level of debt.

Financial Performance

FY-24 FCF came in at €3.1bn ahead of guidance. Net debt at €32.6bn (FY-23: 34.5bn), which is good news.

Negative Factors

Earnings

Bayer underperformed significantly due to weaker-than-expected agrochemicals performance and questions on long-term pharma growth.

Generic Competition

The Crop Science business is facing a broader-than-expected generics impact, affecting the company's overall performance.

Litigation

Ongoing litigation related to glyphosate is creating uncertainty for investors, with 67,000 cases still unsettled.

Market Conditions

Bayer is cautious for FY-25 and the wide margin range of 300bps is explained by the uncertainty around the generic competition for Xarelto in Europe.

Bayer Business Overview & Revenue Model

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.

How the Company Makes Money

Bayer makes money through its three main divisions: Pharmaceuticals, Consumer Health, and Crop Science. The Pharmaceuticals division generates revenue through the sale of prescription drugs, which are often protected by patents, allowing for premium pricing and a significant share of the company's income. The Consumer Health division provides over-the-counter products available to consumers worldwide, contributing to a steady stream of revenue through well-known brands. The Crop Science division earns money by selling seeds, crop protection products, and digital farming solutions that help farmers increase crop yields and efficiency. Revenue is further supported by strategic partnerships, collaborations, and acquisitions that enhance Bayer's product offerings and market reach.

Bayer Financial Statement Overview

Summary

Bayer's financial performance is hindered by weak profitability and high leverage, as evidenced by negative net income and a high debt-to-equity ratio. However, strong gross margins and positive cash flow management provide some stability.

Income Statement

Bayer's income statement shows weak profitability with net losses in recent years. The TTM (Trailing-Twelve-Months) gross profit margin is 54.0%, which is strong, but the net profit margin is negative due to the significant net loss. Revenue growth has been inconsistent, with a recent decline from 2023 to 2024. EBIT and EBITDA margins are also under pressure, indicating challenges in operational efficiency.

Balance Sheet

The balance sheet reflects a high debt-to-equity ratio, signaling significant leverage, which poses risk in times of financial stress. The equity ratio stands at 29.7%, indicating moderate equity financing. Return on Equity (ROE) is negative due to net losses, demonstrating challenges in generating returns for shareholders.

Cash Flow

Bayer's cash flow statement shows resilience with a positive operating cash flow and a decent free cash flow. The free cash flow has grown compared to the previous period, highlighting effective cash management. The operating cash flow to net income ratio is favorable, suggesting robust cash generation despite accounting losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	46.58B	46.61B	47.64B	50.74B	44.08B	41.40B
Gross Profit	25.15B	25.34B	27.89B	30.87B	27.27B	22.26B
EBITDA	8.08B	8.81B	4.21B	10.44B	6.97B	-11.48B
Net Income	-3.25B	-2.55B	-2.94B	4.15B	1.00B	-15.56B
Balance Sheet
Total Assets	109.18B	110.85B	116.26B	124.88B	120.24B	117.05B
Cash, Cash Equivalents and Short-Term Investments	5.38B	8.09B	10.59B	10.15B	7.74B	11.88B
Total Debt	39.38B	40.81B	44.79B	41.32B	39.53B	41.55B
Total Liabilities	76.60B	78.81B	83.18B	85.95B	87.07B	86.35B
Stockholders Equity	32.45B	31.91B	32.93B	38.77B	33.02B	30.52B
Cash Flow
Free Cash Flow	5.27B	4.59B	2.37B	4.14B	2.48B	2.48B
Operating Cash Flow	7.99B	7.37B	5.12B	7.09B	5.09B	4.90B
Investing Cash Flow	22.00M	164.00M	-4.01B	-2.38B	855.00M	-4.07B
Financing Cash Flow	-9.10B	-7.18B	-679.00M	-4.22B	-5.64B	423.00M

Bayer Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 26.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:BAYN, the sentiment is Positive. The current price of 26.98 is above the 20-day moving average (MA) of 26.63, above the 50-day MA of 24.69, and above the 200-day MA of 23.14, indicating a bullish trend. The MACD of 0.57 indicates Positive momentum. The RSI at 61.46 is Neutral, neither overbought nor oversold. The STOCH value of 35.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:BAYN.

Bayer Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BAYN	62 Neutral	€26.50B	―	-9.56%	0.36%	-0.92%	-4.30%
Sector *	46 Neutral	C$190.36M	-4.25	-8.56%	3.09%	13.53%	-1.76%
0H9X		€14.17B	22.92	4.37%	2.98%	―	―
0OO9		€23.75B	56.85	6.28%	2.04%	―	―
0O14		€48.98B	17.38	9.74%	1.97%	―	―
0NIQ		€13.80B	127.95	3.55%	0.41%	―	―
SEMHF		$61.33B	27.38	11.14%	1.80%	―	―

Bayer Corporate Events

Bayer Supervisory Board Member Purchases Company Shares

Bayer Aktiengesellschaft announced a transaction involving the purchase of shares by a member of its supervisory board, Kimberly Mathisen. This transaction, conducted at the Frankfurt Stock Exchange, reflects the board members’ commitment to buy Bayer AG shares, potentially signaling confidence in the company’s future performance.