Using the TipRanks Stock Screener for the German market, we have picked up two stocks that are favorites among analysts. Pharmaceutical company Bayer AG (DE:BAYN) and automobile giant Volkswagen (DE:VOW3) have shown good growth in their stock prices this year and have further upside potential of more than 20%.
The analysts are impressed by recent developments in these companies and expect this momentum to continue.
TipRanks’ tools, such as Stock Screener and Stock Comparison, are ideal for screening stocks from a large list of companies. These stocks could be further compared on different parameters to make an appropriate decision.
Let’s discuss these German stocks in detail.
Bayer is a pharmaceutical and biotechnology company that operates in three major product areas: pharmaceuticals, consumer health, and crop science.
The company’s stock has started the new year on a positive note with a 20.3% gain YTD. The shares touched their highest price in the last seven months. After facing criticism from investors over dull share price growth, the company recently announced a leadership change, which was welcomed by investors as well as analysts.
Bayer appointed Bill Anderson as the CEO of the company, starting in June 2023. Anderson has extensive experience in the life sciences industry, most recently serving as CEO of Roche’s pharmaceutical division. Analysts believe his strong network connections in the U.S. market will benefit Bayer in a big way.
Moving forward, analysts are also bullish on the company’s improving results and its new drug pipeline. The four new upcoming drugs create a €12 billion sales opportunity for the company.
Many analysts have reiterated their Buy rating on the stock following the CEO announcement and ahead of its earnings. Falko Friedrichs from Deutsche Bank is positive about the leadership change and feels “the executive’s strong background in biotech should allow him to quickly familiarize himself with the company’s giant crop science business.”
The company will release its annual results for 2022 on February 28.
What is Bayer’s Share Price Target?
The BAYN target price is €76, which suggests a potential upside of 27.5% on the current price level.
The stock has a Strong Buy rating on TipRanks, based on nine Buy and three Hold recommendations.
Volkswagen AG (VW)
VW is a luxury automobile company that owns well-known brands like Volkswagen, Skoda, Audi, Bentley, Ducati, Lamborghini, and more.
After losing almost 14% of its value, VW stock gained some momentum and has been trading up by 7.36%. In 2023, analysts remain bullish on the stock considering its growing focus in the electric vehicle space and its strong recovery in the third quarter results of 2022.
Last week, the company announced its five-year plan to speed up its EV production and capture a higher market share. As per this plan, the company is planning to revive its software strategy to solve various problems impacting EV production. The company is already witnessing huge growth in its EV sales, with a 25% increase in deliveries in the first nine months of 2022.
In 2022, VW led the battery electric vehicle (BEV) space in Europe with a 22.4% market share. However, considering the record registration of EVs in Europe, the company has plenty of room for further growth.
Among the recent ratings on the stock, analyst Tom Narayan from RBC Capital has the highest target price of €237 on the stock. This implies an upside potential of 84%. Narayan believes VW car sales will improve further after the opening of the Chinese economy, which is the largest market for EVs.
Is Volkswagen a Good Stock to Buy Right Now?
According to TipRanks’ rating consensus, VW stock has a Moderate Buy rating.
The average target price is €169.7, which is 31.6% higher than the current price.
Both Bayer and Volkswagen have started 2023 with positive news, which has pushed their stock prices in the right direction. Analysts are optimistic about the future and see greater upside potential.