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Bayer AG’s(BAYRY - Free Report) first-quarter 2019 core earnings per share of 74 cents per American Depositary Receipt ("ADR") increased 9.9% year over year. Core earnings per ADR also beat the Zacks Consensus Estimate of 54 cents per share.
Total sales in the quarter were $14.2 billion, up 6% from the year-ago quarter. The growth was driven by higher sales across segments, namely Crop Science, Pharmaceuticals and Consumer Health.
Shares of the company have decreased 19.9% so far this year against the industry’s 0.1% growth.
All the growth rates mentioned below are on a year-over-year basis, and after adjusting for currency and portfolio changes.
Quarter Highlights
The company started reporting under three segments — Pharmaceuticals, Consumer Health and Crop Science — from the quarter under review. Please note that the company had announced divestment of its Animal Health business to Elanco (ELAN - Free Report) in 2019 and reports the segment under discontinued operation.
In the reported quarter, Crop Science sales were €6,834 million, up 5.7% from the year-ago quarter. While sales of Fungicides, Corn Seed & Traits, Herbicides, Insecticides and Environmental Science were strong during the quarter, segment revenues were hurt by decline in sales of Vegetable Seeds, Soybean Seed & Traits and other.
Revenues at the Pharmaceuticals segment increased 3.9% to €4,546 million in the first quarter, mainly driven by strong sales of blood thinner drug, Xarelto, which the company co-developed with J&J (JNJ - Free Report) . Higher sales of Eylea, Adempas and Stivagra also boosted the segment’s revenues. However, lower sales of Nexavar and Glucobay partially offset the gains. Glucobay sales were significantly down due to restrictions in connection with COVID-19 in China as well as anticipated significant price reductions.
Consumer Health sales were up a healthy 13.5% year over year to €1,398 million in the first quarter, primarily due to substantial increase in demand, partly for inventory buildup, due to the COVID-19 pandemic.
2020 Guidance
Bayer stated that previously provided outlook for 2020 on its fourth-quarter earnings call did not include the impact of COVID-19. However, the company maintains the outlook. It expects currency-adjusted sales from continuing operations to amount to €44-€45 billion. This corresponds to an increase of about 3-4% on a currency- and portfolio-adjusted basis.
Core earnings per share are expected to increase between €7.00 and €7.20 on a currency-adjusted basis.
Meanwhile, the company stated that following a good start in the first quarter of 2020, it expects COVID-19 to impact the company’s business for the rest of 2020. However, the company stated that it is not possible to reliably assess the positive and negative effects of the pandemic until later in the year due to current volatile and uncertain conditions globally.
Bayer Aktiengesellschaft Price, Consensus and EPS Surprise
Lilly’s earnings per share estimates have moved up for 2020 from $6.77 to $6.79 and for 2021 from $7.93 to $7.99 in the past 30 days. The company delivered a four-quarter positive earnings surprise of 8.24%, on average.
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Bayer (BAYRY) Q1 Earnings Beat Estimates, Sales Rise Y/Y
Bayer AG’s (BAYRY - Free Report) first-quarter 2019 core earnings per share of 74 cents per American Depositary Receipt ("ADR") increased 9.9% year over year. Core earnings per ADR also beat the Zacks Consensus Estimate of 54 cents per share.
Total sales in the quarter were $14.2 billion, up 6% from the year-ago quarter. The growth was driven by higher sales across segments, namely Crop Science, Pharmaceuticals and Consumer Health.
Shares of the company have decreased 19.9% so far this year against the industry’s 0.1% growth.
All the growth rates mentioned below are on a year-over-year basis, and after adjusting for currency and portfolio changes.
Quarter Highlights
The company started reporting under three segments — Pharmaceuticals, Consumer Health and Crop Science — from the quarter under review. Please note that the company had announced divestment of its Animal Health business to Elanco (ELAN - Free Report) in 2019 and reports the segment under discontinued operation.
In the reported quarter, Crop Science sales were €6,834 million, up 5.7% from the year-ago quarter. While sales of Fungicides, Corn Seed & Traits, Herbicides, Insecticides and Environmental Science were strong during the quarter, segment revenues were hurt by decline in sales of Vegetable Seeds, Soybean Seed & Traits and other.
Revenues at the Pharmaceuticals segment increased 3.9% to €4,546 million in the first quarter, mainly driven by strong sales of blood thinner drug, Xarelto, which the company co-developed with J&J (JNJ - Free Report) . Higher sales of Eylea, Adempas and Stivagra also boosted the segment’s revenues. However, lower sales of Nexavar and Glucobay partially offset the gains. Glucobay sales were significantly down due to restrictions in connection with COVID-19 in China as well as anticipated significant price reductions.
Consumer Health sales were up a healthy 13.5% year over year to €1,398 million in the first quarter, primarily due to substantial increase in demand, partly for inventory buildup, due to the COVID-19 pandemic.
2020 Guidance
Bayer stated that previously provided outlook for 2020 on its fourth-quarter earnings call did not include the impact of COVID-19. However, the company maintains the outlook. It expects currency-adjusted sales from continuing operations to amount to €44-€45 billion. This corresponds to an increase of about 3-4% on a currency- and portfolio-adjusted basis.
Core earnings per share are expected to increase between €7.00 and €7.20 on a currency-adjusted basis.
Meanwhile, the company stated that following a good start in the first quarter of 2020, it expects COVID-19 to impact the company’s business for the rest of 2020. However, the company stated that it is not possible to reliably assess the positive and negative effects of the pandemic until later in the year due to current volatile and uncertain conditions globally.
Bayer Aktiengesellschaft Price, Consensus and EPS Surprise
Bayer Aktiengesellschaft price-consensus-eps-surprise-chart | Bayer Aktiengesellschaft Quote
Zacks Rank & Stock to Consider
Bayer currently carries a Zacks Rank #3 (Hold).
Eli Lilly and Company (LLY - Free Report) is a better-ranked stocks from the healthcare space, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Lilly’s earnings per share estimates have moved up for 2020 from $6.77 to $6.79 and for 2021 from $7.93 to $7.99 in the past 30 days. The company delivered a four-quarter positive earnings surprise of 8.24%, on average.
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Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.
These 7 were selected because of their superior potential for immediate breakout.
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