BAYN-DEU - Embedded Expectations Analysis - 2018 10 03
Bayer Aktiengesellschaft (BAYN:DEU) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 14.7x Uniform P/E. At these levels, the market is pricing in bearish expectations for the firm and management has concerns about their ability to improve their EBITDA, earnings, and growth in the EMEA regionSpecifically, management may be concerned about the upcoming glyphosate litigation, and may lack confidence in their ability to meet their earnings and EBITDA targets. Also, they may be concerned about continued EBITDA weakness in the pharma segment, and may lack confidence in their ability to drive crop protection sales. Moreover, they may lack confidence in their ability to further de-lever their firm, and manage currency risk in H2 2018. Furthermore, they may be exaggerating their satisfaction with channel inventories in Brazil, and may be concerned about declining growth in the EMEA region
Bayer is a life sciences group based in Germany. Co.'s operations are organized along three divisions: Pharmaceuticals (engaged in prescription pharmaceuticals for cardiology and women's healthcare); Consumer Health (engaged in non-prescription products in dermatology, dietary supplement, analgesic, gastrointestinal, allergy, cold and flu, foot care, sun protection and cardiovascular risk prevention categories); and CropScience (engaged in the development of seeds and plant traits; crop protection; and for gardens, the green industry and non-agricultural pest control). Co. also maintains an Animal Health business unit engaged in the development of products for farm and companion animals.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.