BAYER

Analysis of Bayer share price

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Latest news

Bayer suffers heavy quarterly losses due to glyphosate

04/08/2020 - 14h55

Find information on Bayer's recent quarterly results with a loss of nearly €9.5 billion and the causes of these losses, particularly with regard to glyphosate.

28/04/2020
Bayer reports better than expected EPS in the first quarter

Elements that can influence the price of this asset:

Analysis N°1

We would of course monitor new medicines and treatments introduced onto the market that appear particularly promising or with high potential by this group.

Analysis N°2

The partnerships, mergers and acquisitions operations of the Bayer Group should also be closely monitored.

Analysis N°3

The Bayer group’s activities and future also depend on the growth of the cereal crops industry which should therefore be monitored carefully.

Analysis N°4

Of course, the world economy and particularly the problems encountered by the pharmaceutical industry are also influential factors on the Bayer share price.

Analysis N°5

Clearly the same is true for controls and regulations, notably those that relate to the prices of pharmaceutical products that could have negative consequences on the group’s profitability.

Analysis N°6

Finally, we would monitor the development of similar but low cost products by competitors and on their share of the market parts.

Analysis N°7

Since the acquisition of Monsanto by Bayer, we would also follow news relating to the use of glyphosate which is currently a frequent topic and could negatively influence the group’s sales.

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General presentation of the Bayer Company:

Bayer is currently one of the chemical industry’s pillars in the creation, production and sale of pharmaceutical products. Its activities are spread across several sectors such as health products as well as high performance materials, agrochemical products and other less significant activities.

This company’s turnover is generated in countries including Germany, the United States, China and elsewhere.

Knowing the competition to Bayer shares:

The global pharmaceutical sector is extremely competitive and therefore Bayer has to face great pressure from several large pharmaceutical companies that constantly seek to increase their share in the market. We therefore provide you here with information about Bayer’s top competitors to assist you in your share price analysis of this group.

Pfizer: Currently in pole position in this list of global pharmaceuticals with sales of over 50 billion dollars per year.
Novartis: Second position in this classification with 43 billion Euros of sales per year on average.
Sanofi: This company occupies third position with 33 billion Euros per year.
Roche: And then Merck, holding fourth and fifth positions.
Bayer: Bayer is actually listed at tenth on this list just after the GSK Laboratories, J & J, Astrazeneca and Lilly.

Strategic alliances implemented by the Bayer Group:

A number of strategic alliances and partnerships have also influenced the Bayer share price. Here are the major partners of this group.

Farm Frites: In 2015 Bayer CropScience and Farm Frites jointly opened sustainable practices in potato cultivation in Europe.
Leica Biosystems: In 2016 Bayer announced a new collaboration with Leica Biosystems to develop a new companion diagnostics test for cancer patients.
Monsanto: Finally, in 2017 Bayer found itself on the right path for the completion of the Monsanto acquisition before the end of the year for 66 billion dollars, as announced in September of that year. BASF SE and Syngenta AG were also companies that submitted preliminary applications for the assets that Bayer foresaw selling in order to obtain the regulatory approval for the acquisition of Monsanto.

Introduction and quotation of the Bayer shares:

Bayer shares are quoted on the German stock market, the Deutsche Bourse AG, and integrated in the calculation of the Eurostoxx 50 stock market index.

Historically, the share price of the Bayer Company has experienced strong fluctuations over the years, particularly following the creation of new chemical and technological products.

Important data

In 2017, the stock market capital of the Bayer Company was 98,379.39 million Euros.
826,947,808 shares have been issued by the company and are currently in circulation on the market.
The share price is currently quoted on the Prime Standard market of the Deutsche Bourse AG.
The company is also part of the composition of the DAX 30 stock market index.

Economic history

To be able to understand what can influence the rise or fall in the Bayer share price it is necessary to complete an economical and financial analysis of the company over the last few years. This is therefore what we offer you right now by summarising the major influential events over the last few decades.

In 2002 the Bayer group acquired the agronomics branch of the Aventis Company which then became Bayer CropScience AG. This company is specialised in agrochemicals, genetically modified seeds.
In 2003 the group reorganises into a company group.
In 2004 Bayer shares its chemical activities with the Lanxess Company.
In 2006 the group launched a takeover bid for the Schering AG Company which finally led to a merger in 2007. The health section of the group integrated its ethical health, family health and veterinary health sectors together with diagnostics.
In the same year the group found itself in conflict with the French and Nova Scotia beekeepers and activity in this field was temporarily suspended in France.
In 2012 Bayer announced the acquisition of a vitamin supplements company, Schiff, for 1.2 billion dollars.
In 2013 it purchased the Norwegian company Algeta for 2.4 billion dollars.
In 2014, the group acquired a company specialised in traditional Chinese medicine for an unknown sum estimated to be around 500 million Euros. In the same year it acquired the over the counter medicine activities of the company Merck & Co for 14.2 billion dollars. These agreements showed a smaller scale partnership agreement on branded medicines, notably Adempas. Also in 2014 Bayer sold its international activities in the production of medical materials such as catheters for 415 million dollars to Boston Scientific.
In 2015 it sold its diabetes related activities to a subsidiary of Panasonic Health Care which is also active in this sector. In the same year the group divided its activities in material science.
In 2016, the group launched an acquisition bid for the Monsanto Company for the sum of 62 billion dollars. This offer led to two weeks of rumours and speculation. The offer was then increased to 66 billion dollars. Bayer then announced that their bid had been accepted by the Monsanto shareholders.
In 2017, the group sold part of its share in the Covestro Company for 1.46 billion Euros. Its part thereby decreased to 53.3%.

Using the analysis of events that we have provided above you will find it easier to understand the future economic and financial events that will probably influence this company’s share price.

The advantages and strong points of Bayer shares as a stock market asset:

Firstly, we should of course underline the presence of Bayer on an international level which represents a major strength of this group. With more than 300 companies based in 78 different countries, the distribution system implemented by Bayer is solid as well as highly integrated. To achieve this Bayer has been able to count upon its experience of over 150 years in the sectors of health and agriculture.

Another considerable advantage for the Bayer Company concerns the division of its different activities into different sectors. The group has in fact structured its activities into three major groups with a pharmaceutical division, a consumer health and plant science sector and lastly the animal health sector which creates products and solutions for the treatment of domestic animals.

The Bayer Group is also renowned for its innovative capabilities which are a real advantage in this highly competitive activity sector. In fact, we owe a lot to the R & D division of Bayer for truly revolutionary products created in the past such as aspirin, Rennies, and Poncho. And the company continues to be innovative.

The excellent performance of the Bayer Company is also due to a particularly intelligent work organisation. The Bayer workforce of around 115,000 people worldwide is basically in continuous training and benefit from a healthy work environment which significantly increases the profitability of the group and also its innovative capabilities.

Finally, Bayer’s financial performance is satisfactory with a good solid treasury flow. The financial health of the company is therefore considered to be solid and reliable. The dividends paid are also attractive for shareholders of this asset.

The disadvantages and weak points of Bayer shares as a stock market asset:

Firstly the Bayer Company is subject to laws that are unfavourable to patents, notably by third world governments that particularly support local companies for the development of generic medicines.
The current regulatory environment is also an impediment to Bayer’s development. In fact, the FDA and other similar entities have recently strengthened the regulations applicable to drug testing and related fields due to numerous protests by human rights activists around the world.
Recently, the Bayer Group has also been subject to allegations related to price fixing which have severely tarnished its brand image and may continue to influence its sales in the future.
Finally, although the Bayer group, as with most of its competitors, has invested heavily on the development of biotechnical products, the highly complex manufacturing of these products also increases the risks.

To summarise, the weak points of this asset appear as significant and impactful as its advantages and it is therefore primordial that you take them into account when taking position on the price of this share on the stock markets.

Frequently Asked Questions

Who are the main subsidiaries of the Bayer group today?

If the Bayer group has managed to become one of the major players in the pharmaceutical sector today, it is undoubtedly thanks to its various investments in subsidiaries in Germany but also abroad. Today, the various subsidiaries owned by the Bayer group include Bayer Health Care AG which also includes Bayer Schering Pharma, Bayer CropScience AG, Bayer Material Science AG as well as Monsanto which was the last major acquisition made by this company for the purpose to diversify.

When did the takeover of Monsanto take place by the Bayer group?

Bayer’s takeover of Monsanto has been one of the most significant events in this company's history. This takeover was thus launched in 2016 by an offer made by Bayer and in the amount of $ 62 billion and after two weeks of rumors about it. It was in September of the same year that the group announced an increase in its offer to 66 billion dollars. It will finally be accepted by Monsanto on September 14 and Bayer will then officially announce the acquisition of this group.

Who are the three largest shareholders of the Bayer group?

Currently, the Bayer group is owned by various major shareholders, the first three of which we will present here in terms of shares. These include the BNP Paribas Asset management group which holds 6.65% of the group's shares, Temasek Holdings Pte Ltd which holds 3.71% of the capital and finally Norges Bank Investment Management with 3.01% of the shares.

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