Bayer's (BAYRY) Q3 Earnings Beat Estimates, Revenues Rise Y/Y
Bayer's (BAYRY) earnings in the third quarter of 2021 beat estimates. Revenues surge year over year.
Bayer AG BAYRY reported third-quarter 2021 core earnings of 31 cents per American Depositary Receipt (ADR), which marginally beat the Zacks Consensus Estimate of 30 cents and also increased from the year-ago quarter’s earnings of 24 cents per share.
Total sales in the third quarter were $11.54 billion, up from $9.94 billion reported in the year-ago quarter.
Shares of Bayer have plunged 1.5% in the year so far against the industry’s growth of 16.7%.
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All growth rates mentioned below are on a year-over-year basis and after adjusting for currency and portfolio changes.
Quarter in Detail
Bayer started reporting under three segments from the fourth quarter of 2019 — Pharmaceuticals, Consumer Health and Crop Science.
In the third quarter of 2021, Crop Science sales were €3.85 billion, up 25.8% from the year-ago quarter, driven by substantial increase in volumes and prices. Herbicide sales increased 15.2% as a result of volume gains in all regions, besides higher prices. Business also improved at Soybean Seed & Traits. Sales of Corn Seed & Traits soared 92.6% year over year, driven by gains in North America due to lower product returns and the later receipt of license revenues.
Revenues in the Pharmaceuticals segment surged 7.1% to €4.539 billion in the third quarter owing to robust recovery from the COVID-19-induced restrictions, especially in Europe. Other products, such as the oral anticoagulant Xarelto, co-developed with J&J JNJ, and newly launched cancer drug Nubeqa, also contributed to growth. Xarelto sales increased 4.3%, mainly as a result of higher volumes in Germany and Russia. Sales of the ophthalmology drug, Eylea, increased 19%, driven by strong growth as a result of high demand. Please note that Bayer’s HealthCare unit co-develops Eylea with Regeneron REGN.
Consumer Health sales were up 10.9% year over year to €1.346 billion in the third quarter, primarily due to growth in all regions and categories. The business benefited from the launch of innovative products and continued high demand in Nutritionals as its sales increased 20.1%. The Pain & Cardio category also registered sales growth of 17.4%.
Bayer upgraded its financial guidance for core earnings for full-year 2021 following a strong business performance in the third quarter of 2021.
The company now expects to generate core earnings per share of about €6.50 to €6.70 compared with the previous expectation of €6.40 to €6.60.
The company continues to expect sales of approximately €44 billion for 2021, which is unchanged from the previous expectation.
Bayer Aktiengesellschaft Price, Consensus and EPS Surprise
Zacks Rank & Stock to Consider
Bayer currently carries a Zacks Rank #4 (Sell).
A top-ranked stock in the large cap pharma sector is GlaxoSmithKline plc GSK, which has a Zacks Rank #1 (Strong Buy) at present.You can see the complete list of today’s Zacks #1 Rank stocks here.
GlaxoSmithKline’s earnings estimates have been revised 6.5% upward for 2021 and 3.6% upward for 2022 over the past 60 days. The stock has rallied 16.2% year to date.
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