Bayer AG (BAYGn.DE) Financial performance remains strong, we still see multiple routes to upside

Equity Research 5 August 2026 | 5:31AM BST

Bayer AG (BAYGn.DE) Financial performance remains strong, we still see multiple routes to upside

BAYGn.DE 12m Price Target: €63.50 Price: €48.25 Upside: 31.6% BUY James Quigley Bayer reported strong 2Q26 results with a 2% beat on top line and a | Goldman Sachs International 10% beat on EBITDA (before special items), driven by Rajan Sharma stronger-than-expected Crop performance - however FY26 | Goldman Sachs International guidance was not updated, suggesting that 2H26 could be weaker than consensus had originally expected (or consensus potentially Max Da, Ph.D. | Goldman Sachs International reflected inaccurate assumptions on phasing in the first place). For 1H26, sales and EBITDA grew by 3% and 7%, respectively, at CER, which were at or above the upper end of the guidance ranges for the Key Data _____________________________________ Market cap: €47.4bn / $54.6bn full year (Sales: 0% to 3% at CER; EBITDA -1% to +4% at CER), Enterprise value: €80.9bn / $93.3bn 3m ADTV: €129.7mn / $149.2mn suggesting potential for upside, despite management’s apparent Germany caution around guidance. Additionally, management did not give an Europe Pharma & Life Sciences M&A Rank: 3 indication whether a breakup of the conglomerate structure could Leases incl. in net debt & EV?: Yes

be an option or on potential timing, which in our view could have GS Forecast __________________________________ 12/25 12/26E 12/27E 12/28E contributed to a partial reverse of the share price gain (+5% at peak Revenue (€ mn) New 45,575.0 45,945.3 47,923.7 49,754.3 vs. 2.4% at close) - however, we continue to see a SOTP/break-up Revenue (€ mn) Old 45,575.0 45,558.5 46,878.9 48,523.7 EBIT (€ mn) 8,082.0 7,486.3 8,249.4 9,135.7 story as a key potential long term upside driver (see here). On EPS (€) New glyphosate litigation updates, which we believe will continue to EPS (€) Old P/E (X) dominate investor sentiment, management noted potential to allow Dividend yield (%) 0.4 0.2 0.2 0.2

additional opt-ins post the settlement deadline, which we view as CROCI (%) 1.0 7.8 7.5 7.7 N debt/EBITDA (ex lease,X) 3.2 3.5 3.0 2.6 positive as we believe the settlement would enable Bayer to move past the litigation overhang. We will pay close attention to the 3/26 6/26 9/26E 12/26E EPS (€) fairness hearing scheduled on Aug 19th. Beyond litigation, we are GS Factor Profile ______________________________ positive on topline growth driven by Nubeqa and Kerendia from Growth

Pharma. With this note, we raise our peak sales estimates by 16% for Financial Returns Nubeqa, driven by continued strong sales momentum, and increase our estimates on R&D and SG&A to reflect investments needed for Multiple

pipeline development and marketing expenses for Nubeqa. We Integrated

remain Buy rated with minor changes to our 12m Price Target up 1.6% to €63.5 - which we believe could be realised through a Percentile 20th 40th 60th 80th 100th

combination of (1.) Strong performance in Pharma - driving BAYGn.DE relative to Europe Coverage

underlying earnings upgrades, (2.) a full resolution of the BAYGn.DE relative to Europe Pharma & Life Sciences

glyphosate litigation removing any residual overhang on the Source: Company data, Goldman Sachs Research estimates. See disclosures for details. shares and (3.) realisation of a SOTP/break-up story over the

Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in the U.S.

Goldman Sachs Bayer AG (BAYGn.DE)

Bayer AG (BAYGn.DE) Balance Sheet (€ mn) _______________________________________ BUY Rating since Jun 5, 2025 12/25 12/26E 12/27E 12/28E Cash & cash equivalents 6,671.0 8,693.2 9,032.7 7,872.8 Accounts receivable 9,077.0 9,440.8 9,847.3 10,359.8 Inventory 12,378.0 11,484.6…