Analyst Note
| Damien Conover, CFA |Bayer reported second-quarter results slightly ahead of our expectations, but we don’t expect any major changes to our fair value estimate based on the minor outperformance. We continue to view Bayer as undervalued, with the market not fully appreciating the company’s strong current portfolio and developing pipeline, which also gives us confidence in our wide moat rating. Further, we believe the market is focusing too much on the ongoing glyphosate litigation, which has contributed to the stock trading at an industry-lagging multiple. We expect the large legal reserves already taken will largely cover the remaining glyphosate legal issues.