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    Is Covestro (DB:1COV) Cheap On Its Return To Half Year Profit?

    Simply Wall St·08/09/2026 10:29:01
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    Why Covestro’s latest earnings matter for shareholders

    Covestro (DB:1COV) has drawn fresh attention after reporting half year 2026 results that moved from a net loss to a net profit, even though sales for the period were slightly lower than a year earlier.

    The company reported sales of €6,729 million for the half year to June 30, 2026 compared with €6,856 million a year earlier. Net income reached €120 million compared with a net loss of €219 million and basic earnings per share from continuing operations were €0.58 compared with a basic loss per share of €1.16.

    See our latest analysis for Covestro.

    Covestro’s latest move back into profit comes at a time when its share price has been relatively steady, with a 90 day share price return of 1.84% and a 3 year total shareholder return of 30.94%. This suggests momentum has been gradual rather than rapid.

    If you are weighing Covestro’s update against other opportunities in the market, it can help to compare it with companies exposed to similar long term themes by checking the 37 power grid technology and infrastructure stocks

    Covestro has moved back into profit and the stock trades at a discount to both internal fair value estimates and analyst targets. Is the market rightly cautious here, or is it underpricing that improvement in the numbers?

    Most Popular Narrative: 1.8% Undervalued

    The most followed narrative currently places Covestro’s fair value at €62, slightly above the last close of €60.9. That small gap is where the investment debate starts.

    The acquisition of Pontacol and the planned purchase of two HDI derivative facilities in the U.S. and Thailand increase Covestro's footprint in coatings and adhesives for mobility, construction and furniture. This can support future revenue and EBITDA through added capacity and broader product offerings.

    Read the complete narrative.

    Want to see what turns extra coating capacity and higher EV material content into that fair value number? The narrative leans on steady revenue expansion, a clear margin rebuild and a punchy future earnings multiple that does not look typical for a cyclical chemicals stock. Curious which assumptions have to line up to make that price tag make sense?

    Result: Fair Value of €62 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, this Covestro story can change quickly if industry oversupply keeps pricing under pressure or if further plant disruptions repeat the Dormagen experience.

    Find out about the key risks to this Covestro narrative.

    Next Steps

    The mix of optimism and caution around Covestro is clear, so it helps to test that sentiment against the data yourself and move quickly while the picture is fresh in your mind by reviewing the 2 key rewards and 1 important warning sign

    Looking for more investment ideas beyond Covestro?

    If Covestro has sharpened your focus, do not stop here. Use the Simply Wall St Screener to spot other opportunities that could fit your risk and return preferences.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.