Bayer AG (BAYgn.DE): Expecting a broadly inline 2Q; Pharma delivery is key post-litigation

研报英文原文证据摘录

Bayer AG (BAYgn.DE): Expecting a broadly inline 2Q; Pharma delivery is key post-litigation

Goldman Sachs Bayer AG (BAYGn.DE)

calculation issues as we are broadly in line on Core EBIT and Core Net income.

n We expect FY26 guidance to be reiterated. Visible Alpha Consensus estimates are

broadly in line with the mid-point of the company’s guidance range on Group

sales/EBITDA-pre special and slightly above on Core EPS (3% above).

n Litigation - what’s next? Ruveon could ultimately separate long-tail glyphosate

litigation risk from Bayer, in our view. Following the positive US Supreme Court

ruling, the fairness hearing for the Class Settlement has been delayed to August 19th

(from July 9th), which gives Bayer more time to potentially encourage any remaining

opt-outs to join the settlement. In addition, Bayer announced that it has

consolidated all glyphosate operations into a new fully owned entity, Ruveon.

Operationally, the structure allows Ruveon management to focus on running a

strategically distinct business from the other Crop Protection businesses in the Bayer

portfolio. However, we see scope for a future spin-out/separation of the business,

which is non-core to the Crop Protection business. Such a transaction could

effectively ringfence future glyphosate liabilities, with both the settlement and any

residual litigation exposure remaining within Ruveon (with Bayer funding the

settlement payments before any possible separation).

n We increase our 12m price target 14% to €62.5 from €55, driven by reduced

litigation risks and a lower WACC. Our estimates for sales are 0-1% higher for each

division and the Group across FY26-30, driven by FX. As a result, our estimates on

Core EPS are 1% higher across FY26-30. Our price target moves up 14% from €55.0