2 of the best ASX 200 blue chip shares to buy

CSL Limited (ASX:CSL) and this ASX 200 blue chip share could be high quality options for investors right now. Here's why…

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The illustrious S&P/ASX 200 Index (ASX: XJO) is home to a good number of shares with true blue chip status. So many, in fact, it can be hard to decide which ones to include in your portfolio.

In order to narrow things down, I have picked out two blue chip ASX 200 shares which are highly rated right now. They are as follows:

CSL Limited (ASX: CSL)

The first ASX 200 blue chip share to look at is CSL. It is one of the world's leading biotechnology companies, responsible for the CSL Behring and Seqirus businesses.

Last week the company released its half year results and revealed a 16.9% increase in revenue to US$5,739 million and a massive 45% jump in net profit after tax to US$1,810 million. This was driven by a surge in flu vaccine sales, the successful transition to its own distribution model in China, and solid demand for immunoglobulins and HAEGARDA.

Disappointingly, despite this incredible profit growth, management only held firm with its guidance for FY 2021 net profit after tax of US$2,170 million to US$2,265 million in constant currency. This represents year on year growth of just 3% to 8% and implies a sharp profit decline in the second half.

While this is disappointing, the pullback in the CSL share price appears to have left it trading at a very attractive level for a long term focused investor.

For example, in response to its results, analysts at UBS retained their buy rating but trimmed their price target slightly to $330.00. This compares to the current CSL share price of $267.79.

REA Group Limited (ASX: REA)

Another ASX 200 blue chip ASX share to look at is property listings company REA Group. After successfully battling through a tough period because of the pandemic, things are looking incredibly rosy for the company now.

In fact, REA Group just revealed a return to growth in the first half of FY 2021 thanks to its excellent cost control which offset softer revenues.

For the six months ended 31 December, the company reported a 2% decline in revenue to $430.4 million. But thanks to a 13% reduction in operating expenses to $145.8 million, REA Group reported a 9% increase in earnings before interest, tax, depreciation and amortisation (EBITDA) to $290.2 million.

Pleasingly, with the housing market improving, mortgage loan growth accelerating, and house prices tipped to rise strongly in 2021, listing volumes look set to rise strongly over the next 12 months. Thanks to this, its lower costs, potential price increases, and new revenue streams, this could lead to an acceleration in its profit growth.

One broker that is positive on REA Group is Morgan Stanley. It has an overweight rating and $175.00 price target on its shares. This compares to the latest REA Group share price of $150.56.

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia has recommended REA Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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