Undervalued Bayer Posts Strong 3Q, Buoyed by Strong Crop Science Pricing and Recent Drug Launches

Bayer reported strong third-quarter results ahead of our expectations, but we don’t expect any major changes to our fair value estimate. Strong crop science prices partly supported the outperformance, but we expect increased competition in 2023, which will likely reverse some of Bayer's recent gains. However, the crop science business remains well positioned for growth over the long term, led by innovative new products (such as short-stature corn and next-generation trait protection) that help reinforce the firm’s wide moat.