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Bayer's (BAYRY) Q3 Earnings Miss Estimates, Revenues Top
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Bayer AG (BAYRY - Free Report) reported third-quarter 2022 core earnings of 29 cents per American Depositary Receipt (“ADR”), which missed the Zacks Consensus Estimate of 30 cents. The company reported earnings of 31 cents per ADR in the year-ago quarter.
Total sales in the third quarter were $11.37 billion, down from $11.53 billion reported in the year-ago quarter. Revenues beat the Zacks Consensus Estimate of $11.31 billion.
Shares of Bayer have rallied 3.4% in the year so far compared with the industry’s growth of 2.8%.
Image Source: Zacks Investment Research
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 since the fourth quarter of 2019, namely Crop Science, Pharmaceuticals and Consumer Health.
In the third quarter of 2022, Crop Science sales were €4.69 billion, up 8.4% from the year-ago quarter, driven by growth in Latin America and Europe/Middle East/Africa market. Herbicide sales jumped 44.9% owing to prices remaining high, especially in Latin and North America, as well as in Europe/Middle East/Africa. Sales of Corn Seed & Traits were down 15.8% year over year.
Sales of Soybean Seed & Traits decreased 8.3% year over year owing to higher returns in North America.
Revenues in the Pharmaceuticals segment rose 2.9% year over year to €4.95 billion in the reported quarter, owing to higher sales of the ophthalmology drug Eylea, the newly launched cancer drug Nubeqa, as well as other marketed drugs. Please note that Bayer’s HealthCare unit co-develops Eylea with Regeneron (REGN - Free Report) .
Eylea sales increased 4.3%, driven by strong growth as a result of high demand in all regions.
Regeneron records net product sales of Eylea in the United States. Bayer records net product sales of Eylea outside the United States. REGN records its share of profits/losses in connection with sales of Eylea outside the United States.
However, the oral anticoagulant, Xarelto, which Bayer co-develops with J&J (JNJ - Free Report) , witnessed a substantial decline in global sales. Sales of Xarelto were also impacted by the expiration of the patent in Brazil.
J&J is facing patent challenges in the United States for Xarelto and some of its other drugs. JNJ is also working on Xarelto’s label expansion.
Consumer Health sales increased 4.4% year over year to €1.54 billion in the third quarter, owing to strong growth across all regions. The business benefited from the launch of innovative products. The Allergy & Cold category also registered robust sales growth of 16.6%. However, sales in the Nutritionals business decreased 7.9%.
2022 Guidance
BAYRY confirmed the guidance it provided earlier this year. The company remains on track to achieve the full-year financial targets, which it provided in August.
Image: Bigstock
Bayer's (BAYRY) Q3 Earnings Miss Estimates, Revenues Top
Bayer AG (BAYRY - Free Report) reported third-quarter 2022 core earnings of 29 cents per American Depositary Receipt (“ADR”), which missed the Zacks Consensus Estimate of 30 cents. The company reported earnings of 31 cents per ADR in the year-ago quarter.
Total sales in the third quarter were $11.37 billion, down from $11.53 billion reported in the year-ago quarter. Revenues beat the Zacks Consensus Estimate of $11.31 billion.
Shares of Bayer have rallied 3.4% in the year so far compared with the industry’s growth of 2.8%.
Image Source: Zacks Investment Research
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 since the fourth quarter of 2019, namely Crop Science, Pharmaceuticals and Consumer Health.
In the third quarter of 2022, Crop Science sales were €4.69 billion, up 8.4% from the year-ago quarter, driven by growth in Latin America and Europe/Middle East/Africa market. Herbicide sales jumped 44.9% owing to prices remaining high, especially in Latin and North America, as well as in Europe/Middle East/Africa. Sales of Corn Seed & Traits were down 15.8% year over year.
Sales of Soybean Seed & Traits decreased 8.3% year over year owing to higher returns in North America.
Revenues in the Pharmaceuticals segment rose 2.9% year over year to €4.95 billion in the reported quarter, owing to higher sales of the ophthalmology drug Eylea, the newly launched cancer drug Nubeqa, as well as other marketed drugs. Please note that Bayer’s HealthCare unit co-develops Eylea with Regeneron (REGN - Free Report) .
Eylea sales increased 4.3%, driven by strong growth as a result of high demand in all regions.
Regeneron records net product sales of Eylea in the United States. Bayer records net product sales of Eylea outside the United States. REGN records its share of profits/losses in connection with sales of Eylea outside the United States.
However, the oral anticoagulant, Xarelto, which Bayer co-develops with J&J (JNJ - Free Report) , witnessed a substantial decline in global sales. Sales of Xarelto were also impacted by the expiration of the patent in Brazil.
J&J is facing patent challenges in the United States for Xarelto and some of its other drugs. JNJ is also working on Xarelto’s label expansion.
Consumer Health sales increased 4.4% year over year to €1.54 billion in the third quarter, owing to strong growth across all regions. The business benefited from the launch of innovative products. The Allergy & Cold category also registered robust sales growth of 16.6%. However, sales in the Nutritionals business decreased 7.9%.
2022 Guidance
BAYRY confirmed the guidance it provided earlier this year. The company remains on track to achieve the full-year financial targets, which it provided in August.
Bayer AG Price, Consensus and EPS Surprise
Bayer AG price-consensus-eps-surprise-chart | Bayer AG Quote
Zacks Rank & Another Stock to Consider
Bayer currently carries a Zacks Rank #2 (Buy). Another stock worth considering in the large-cap pharma sector is Merck & Co., Inc. (MRK - Free Report) , which also carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings estimates for Merck have been revised upward by 0.3% for 2022 and 2.3% for 2023 in the past 60 days.
Earnings of Merck have surpassed estimates in all the trailing four quarters. MRK witnessed an earnings surprise of 16.07% on average.