Bayer is scheduled to report results for the second quarter on Tuesday. Here is what you need to know:
SALES FORECAST: Analysts expect the German agricultural-and-pharmaceutical conglomerate to report second-quarter sales of 10.69 billion euros ($12.32 billion), according to consensus estimates compiled by Vara. Bayer reported sales of 10.74 billion euros for the same period last year.
NET PROFIT FORECAST: Bayer is expected to report a net profit from continuing operations of 249 million euros, according to the same consensus. This compares with a loss of 199 million euros Bayer reported for the same period last year.
Shares in Bayer gained 23% during the second quarter, lifted by the U.S. Supreme Court ruling that insulated the company against claims that it failed to warn people about potential cancer risks from its Roundup weedkiller. Since the start of the year through Friday's close, the stock rose 30%.
WHAT TO WATCH:
--ROUNDUP SETTLEMENT: While Bayer secured a win at the Supreme Court, its legal battles over Roundup aren't over. The company continues to pursue final approval of a $7.25 billion class settlement it proposed earlier this year, and a Missouri Circuit Court scheduled a final approval hearing for Aug. 19. Bayer has argued both pathways are needed to significantly contain litigation risk this year. After the Supreme Court ruling, all eyes are on the Roundup settlement, analysts at UBS wrote in a recent note. Some investors have questioned why Bayer didn't pursue an alternative settlement after the favorable Supreme Court challenge, but this would likely push resolution of the litigation into 2027 or beyond, the UBS analysts said. The company will need to weigh both the quality and quantity of cases that have opted out of the settlement, they added.
--POTENTIAL BREAKUP: Some investors hope the parting litigation clouds will allow Bayer to rethink the structure of its operations--spanning agriculture, pharmaceuticals and consumer healthcare products. High debt and big cash outflows limit the company's options, and Bayer would probably need to strengthen its pharma business before any breakup, analysts at Jefferies said. The most likely mechanism to implement a breakup would be a partial IPO of the new Monsanto, similar to BASF's plans for a listing of its agricultural unit next year, Berenberg analysts said.
--OUTLOOK: Bayer executives said at the company's first-quarter results that their guidance for 2026 covered potential effects from the Middle East conflict. The company expects stable sales and Ebitda excluding special items in 2026 when adjusting for currency changes. Bayer is likely to reiterate its full-year guidance, analysts at J.P. Morgan said.
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