Bayer surges; analysts more optimistic following quarterly results
Goldman Sachs, UBS and JPMorgan raise their target prices
Giuliana Licini
Aggiungi Il Sole 24 Oreai preferiti su Google
Le ultime da Radiocor
Borsa: stretta Fed piu' lontana ma Europa frena nel finale, Milano chiude invariata
Wall Street: apre in rialzo (S&P +0,23%), dopo prezzi produzione e calo greggio
*** Leonardo: definita governace jv droni, Basile a.d. e sede ad Albenga
(Il Sole 24 Ore Radiocor) - Bayer is gaining ground on the Frankfurt Stock Exchange, thanks to favourable analyst ratings. Shares in the German pharmaceutical and agrochemical giant are among the top performers on the DAX index following yesterday’s strong performance, on the back of quarterly results that exceeded expectations.
Goldman Sachs has raised its target price for Bayer from €62.50 to €63.50, whilst maintaining its ‘buy’ recommendation. The group’s financial performance remains solid, GS analysts emphasised when commenting on the quarterly results. The upside potential for the share price now depends on the strength of the Pharmaceuticals division, the full resolution of the legal disputes relating to glyphosate and, in the medium to long term, the elimination of the conglomerate discount in the event of a spin-off.
JP Morgan, for its part, maintains a positive outlook on the share with a ‘buy’ recommendation, raising its target price to 61 euros from the previous 50 euros. UBS is also positive and recommends buying the share, raising its target price from €52 to €62. DZ Bank has raised its fair value estimate for Bayer from €54 to €60, whilst maintaining its ‘buy’ recommendation. In a report published on Tuesday, DZ analysts highlighted the group’s operational stabilisation, as well as progress in debt reduction and the management of legal risks in the United States. They have revised their earnings forecasts upwards and incorporated lower net financial debt into their valuation model.
In the second quarter, Bayer reported profits and turnover above estimates. The company also confirmed that it is on track to meet its full-year forecasts, and management expressed confidence despite costs related to litigation and an irregular cash flow. Bayer has also lowered its year-end net financial debt target to €29–30 billion, down from the previous €32–33 billion, thanks to the recently signed agreement with Apollo, which has provided a capital injection of €3 billion in exchange for a minority stake in the entity comprising Bayer’s long-acting contraceptives business.
