Bayer AG Stock: Legal Defeat Triggers Sharp Plunge

Bayer AG's stock suffered a significant setback on Monday, dropping 6.6% to €22.49 on XETRA, with intraday lows approaching €21.95. The dramatic decline was triggered by a substantial legal defeat in Georgia, USA, where a jury awarded approximately $2.1 billion (€1.9 billion) to a plaintiff who claimed the glyphosate-based herbicide Roundup caused his cancer. Bayer immediately announced plans to appeal the verdict, arguing it contradicts scientific evidence and regulatory assessments worldwide, including the US Environmental Protection Agency's determination that glyphosate likely doesn't cause cancer when used as directed. This latest setback adds to the mounting legal challenges facing the company since its 2018 acquisition of Monsanto for approximately $63 billion, with the ongoing litigation significantly eroding shareholder value - the stock now trades nearly 38% below its 52-week high of €31.03.

Financial Implications of Ongoing Litigation

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The German chemical and pharmaceutical giant has already paid €9.2 billion in Roundup-related litigation settlements while setting aside an additional €5.4 billion for over 60,000 outstanding cases. Of roughly 181,000 total glyphosate-related lawsuits, only 114,000 have been resolved so far. The persistent legal troubles have devastated Bayer's market value, which has lost approximately three-quarters of its worth since the Monsanto acquisition, dropping to around €22.4 billion. To manage its substantial debt burden, Bayer plans to pay only the minimum dividend of €0.11 per share over the next three years, slightly up from €0.110 last year. Analysts currently set the fair value of Bayer shares at €24.88 and project earnings of €4.44 per share for fiscal year 2025.