mwb Research reiterated its Buy rating on Bayer AG (ETR: BAYN) following Monday’s U.S. Supreme Court oral arguments in the Monsanto v. Durnell case, calling the hearing “broadly neutral to slightly constructive” and maintaining its €52 price target on the stock, implying a more than 35% upside from current levels.
The case centers on whether federal pesticide law preempts state-law failure-to-warn claims related to Bayer’s Roundup weedkiller.
In a note, mwb Research explained that Missouri plaintiff John Durnell secured a $1.25 million verdict linking Roundup exposure to non-Hodgkin lymphoma, with Bayer arguing that repeated U.S. EPA findings of glyphosate’s non-carcinogenic nature should prevent state juries from imposing additional warning requirements.
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Justices are said to have appeared divided, with a final ruling expected by end of June.
Analyst Abed Jarad acknowledged the hearing provided no decisive outcome but framed it as continued progress in Bayer’s broader litigation containment strategy.
“While oral arguments did not provide a decisive read-through, Supreme Court pre-emption remains a credible catalyst,” Jarad wrote, noting that a favorable ruling, combined with the pending $7.25 billion class settlement, would improve visibility around what mwb Research describes as Bayer’s largest structural overhang.
The firm was careful to temper expectations, noting that even a favorable ruling “would not eliminate all litigation immediately,” given residual non-label-based claims.
Nevertheless, mwb Research argued that “the market still over-discounts prolonged litigation drag,” and sees scope for balance sheet normalization and multiple re-rating as legal milestones are executed.
Bayer shares closed Tuesday’s session at €36.62 after a 4.6% decline.
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