Bayer’s stock sits just above the 50-day moving average at around €39.31, but the real action is happening far from the trading floor. Investors are counting down to a US Supreme Court decision due by the end of June that could define the company’s legal future, while the pharmaceuticals division piles up regulatory wins that offer a separate path to recovery.
The operating business delivered a solid first quarter. Adjusted earnings per share more than doubled to €2.71 from €1.32 a year earlier, while revenues held steady at €13.4 billion. Adjusted operating profit rose 9% to €4.45 billion. Yet none of that moved the needle on the share price, which has climbed roughly 66% over the past twelve months but remains stuck in a narrow range.
The culprit is cash. Legal payouts for glyphosate and PCB claims pushed free cash flow to minus €2.3 billion in the first quarter, and net debt for the full year is expected to land around €32 billion. The company has already set aside €10.4 billion for US litigation contingencies, down from previous levels but still a heavy drag on the balance sheet.
All eyes are now on Washington. The Supreme Court heard oral arguments in the Durnell case against Monsanto in late April and is widely expected to rule by the end of June. At stake is the doctrine of preemption — whether federal EPA approval of glyphosate shields Bayer from state-level failure-to-warn lawsuits. A victory would pull the legal rug out from under thousands of pending claims; a defeat would lock in years of liability.
Bayer is not waiting passively. It has joined forces with industry groups in the new “Modern Ag Alliance” to push for uniform federal labelling standards. Separately, US policymakers are weighing whether to classify domestic glyphosate production as essential, a move that could further influence court dynamics.
Meanwhile, the pharma pipeline is generating its own headlines. The FDA has granted priority review to Kerendia for chronic kidney disease in type 1 diabetes, cutting the standard review timeline from nearly a year to six months. The agency has also awarded fast-track status to the blood thinner Asundexian, which analysts believe could generate multibillion-dollar sales if approved. Similar regulatory processes for Asundexian are underway in Japan.
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Beyond the fast-tracked drugs, Bayer showcased encouraging Phase II data for the cancer treatment Darolutamid in mid-May, part of a broader effort to offset looming patent expirations on older medicines.
Analysts are beginning to price in a more favourable scenario. DZ Bank lifted its target from €44 to €51 and upgraded the stock to “Buy”, citing the strong first quarter and shrinking legal reserves. Barclays and mwb research have set targets of €50 and €52 respectively.
The company also moved to bolster its long-term growth profile by agreeing to buy Perfuse Therapeutics, an ophthalmology specialist, for up to $2.45 billion. The deal fits a strategy of expanding into high-value specialty areas.
A crucial near-term milestone arrives on June 4, when the objection deadline expires for Bayer’s proposed $7.25 billion glyphosate class-action settlement, which has already received preliminary court approval. A decisive hearing follows on July 9. The Supreme Court ruling is expected before that, likely setting the tone for the summer.
Beyond the court calendar, Bayer will report second-quarter results on August 4. Until then, the legal calendar — not the quarterly numbers — holds the key to whether the stock can break out of its sideways drift.
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