Bayer shares plummet after announcing billion-dollar cuts

October 01, 2020 15:30

Bayer shares plummeted by about 10% on the Frankfurt Stock Exchange after the German chemical and pharmaceutical company announced a plan to cut expenses of more than 1.5 billion euros after reporting a profit warning for not meeting cash flow and sales targets for 2020 and 2021.

The company explained that the new cuts are intended to offset the impact of the coronavirus pandemic and the drop in demand for agricultural products, a market in which it intended to expand with the purchase of Monsanto two years ago. In this sense, Bayer will face provisions in its agricultural business of up to 10 billion euros.

The German giant bought Monsanto in 2018, a company that has not stopped suffering setbacks as it has been the subject of tens of thousands of lawsuits in the US for the use of glyphosate in Roundup herbicides, as it supposedly causes cancer.

Bayer's performance on the stock market has been uneven in the last five years:

  • 2016, -14.40%
  • 2017, +4.92%
  • 2018, -40.83%
  • 2019, +20.23%

Between January and October 2020, it has lost 34% of its value.

Source: Admiral Markets MetaTrader 5. Bayer CFD Daily Chart. Data range: from August 28, 2019, to October 1, 2020. Prepared on October 1, 2020, at 11 a.m. Keep in mind that past returns do not guarantee future returns.

In the chart above we can clearly see the fall of Bayer shares in the last candle. The price is dangerously close to the 46 euro support. If it breaks it, it would drop to levels not seen since 2011.

If you want to take advantage of the drops in Bayer, with Admiral Markets UK Ltd you can do so through Contracts for Difference (CFD), a derivative product that allows you to operate in both bull and bear markets. Just open a live trading account by clicking on the following banner:


The data provided provides additional information on all analyzes, estimates, forecasts, forecasts, market reviews, weekly outlooks or other evaluations or similar information (hereinafter "Analysis") published on the Admiral Markets website. Before making any investment decisions, pay close attention to the following:

1. This is a marketing communication. The content is posted for informational purposes only and should not be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and is not subject to any prohibition on pre-dissemination of investment research.

2. Each investment decision is made by each client alone, while Admiral Markets UK Ltd (Admiral Markets) will not be liable for any loss or damage arising from such a decision, whether based on content or not.

3. In order to protect the interests of our clients and the objectivity of the Analysis, Admiral Markets has established relevant internal procedures for the prevention and management of conflicts of interest.

4. The analysis is prepared by an independent analyst, Carolina Caro, SEO implementer (hereinafter "Author") based on personal estimates.

5. While all reasonable efforts are made to ensure that all sources of content are reliable and that all information is presented, as much as possible, in an understandable, timely, accurate, and complete manner, Admiral Markets does not guarantee accuracy. or integrity of any information contained in the Analysis.

6. Any past performance or modelling of the financial instruments indicated in the content should not be construed as an express or implied promise, guarantee, or implication of Admiral Markets for any future performance. The value of the financial instrument may rise and fall, and the preservation of the asset's value is not guaranteed.

7. Leveraged products (including contracts for difference) are speculative in nature and may generate profit or loss. Before you start trading, make sure you fully understand the risks.

Admirals An all-in-one solution for spending, investing, and managing your money

More than a broker, Admirals is a financial hub, offering a wide range of financial products and services. We make it possible to approach personal finance through an all-in-one solution for investing, spending, and managing money.