We are concerned about Bayer’s (BAYRY) disappointing performance of the CropScience segment in the most recent quarter. Moreover, the delay in approval of Xarelto also concerns us.
Furthermore, the failure of Nexavar to prolong the overall survival in patients suffering from advanced non-squamous non-small cell lung cancer (NSCLC) in a late-stage study is a setback for the company. The competitive environment in which Bayer operates is a further challenge for the company.
Given these factors, we downgrade the stock to Underperform from Neutral with a price target of $54.00.