The second quarter has passed, but Bayer, a prominent DAX-listed company, will not release its financial figures for the reporting period until August 6. In the meantime, analysts at Goldman Sachs have revised their outlook on the stock, adjusting the target price to €34, an increase of one euro. Analyst James Quigley continues to recommend buying the stock, noting that currency effects may obscure the company’s strong performance in the pharmaceutical sector. He highlighted that the timing of the U.S. government’s representative’s comments regarding Glyphosate is currently a significant focus.
Bayer stated that currency fluctuations, particularly the U.S. dollar’s performance, have a substantial impact on the company. As a result, Bayer is providing two different forecasts: one adjusted for currency effects and another based on the reported date, with the latest being from March 31. The company noted significant uncertainties concerning future developments related to these issues, as well as over currency trends.
In comparison to the currency-adjusted forecasts, Bayer now expects lower revenues of between €44.5 and €46.5 billion and an EBITDA (earnings before interest, taxes, depreciation, and amortization) range of €9.2 to €9.7 billion for the current fiscal year. Based on the target date forecast, Bayer anticipates a net financial debt between €30.5 and €31.5 billion.
While Goldman Sachs remains optimistic, recommending a buy, other analysts, including those at DER AKTIONÄR, have hesitated to issue a buy recommendation for Bayer. They point out that the Glyphosate issue continues to weigh on the company, and the high net financial debt limits extensive investments in inorganic growth. As a result, many investors are taking a cautious stance and observing from the sidelines.
This outlook reflects a blend of cautious optimism and significant uncertainties within Bayer’s operating conditions, highlighting the importance of upcoming announcements and market reactions. The focus on the pharmaceutical strength juxtaposed with the concerns regarding debt and regulatory challenges suggests a complex path ahead for Bayer, leaving room for potential recovery amid challenges.