Why CSL (ASX:CSL) could be an ASX 50 share to buy

Is this biotech giant a buy?

| More on:
ASX share price movement represented by doctor pressing digitised screen with array of icons including one entitled health insurance,

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

If you're looking to boost your portfolio with some quality shares, then you might want to look at the ASX 50 index. This index is home to some of the largest and highest quality shares on the Australian share market.

One ASX 50 share that could be worth considering is CSL Limited (ASX: CSL).

Why CSL?

CSL is one of the world's leading biotechnology companies. It comprises two businesses, CSL Behring and Seqirus. The former is a specialist in plasma-based products, whereas the latter business specialises in vaccines.

Combined, the two businesses have been underpinning solid sales and profit growth for CSL in recent years. And while plasma collection headwinds could subdue CSL's near term growth, its long term outlook appears very positive. This is thanks to increasing demand for its core therapies and vaccines, and its lucrative research and development (R&D) pipeline.

In respect to the latter, thanks to its consistent investment in R&D (~11% of sales each year), CSL has a pipeline filled to the brim with products that have the potential to generate millions and potentially even billions of dollars in sales each year.

One of these is CSL112, which is a novel apolipoprotein A-I infusion therapy that has been shown to have an immediate and significant impact on the ability to remove cholesterol from arteries. Its phase 3 trial is enrolling more than 17,000 patients from approximately 1,000 medical centres across the world, with the results due at the end of the year.

Another is is clazakizumab, which is being developed to treat kidney transplant rejection. This product alone could generate peak sales of US$5.4 billion.

Is the CSL share price in the buy zone?

While opinion is admittedly divided on whether the CSL share price is in the buy zone right now, one broker that is bullish is UBS.

It currently has a buy rating and $330.00 price target on the company's shares. Based on the latest CSL share price, this implies potential upside of almost 15% over the next 12 months.

Motley Fool contributor 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 and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Healthcare Shares

Male doctor in a lab coat working at laptop looking serious.
Healthcare Shares

This bombshell for ASX healthcare shares could hit 6 million Australians

This could have a large impact.

Read more »

Two scientists in a Rhythm Biosciences lab cheer while looking at results on a computer.
Healthcare Shares

2 ASX healthcare shares having a stellar run today

The ASX healthcare sector is down today but these two stocks are bucking the trend.

Read more »

A company manager presents the ASX company earnings report to shareholders at an AGM.
Healthcare Shares

Why this $13 billion ASX 200 healthcare stock is surging today

A change in sentiment for the healthcare player.

Read more »

Shot of a scientist using a computer while conducting research in a laboratory.
Healthcare Shares

This ASX 200 stock hit a 52-week low and a top broker thinks it can rebound

Patient investors may see this stock make a pleasing recovery.

Read more »

A couple smile as they look at a pregnancy test.
Healthcare Shares

Why this sold-off ASX healthcare share could be an exciting dividend buy

This could be a healthy stock for dividends.

Read more »

a smiling woman sits at her computer at home with a coffee alongside her, as if pleased with her investments.
Healthcare Shares

Is CSL the best ASX 100 share to buy now?

Bell Potter has good things to say about this blue chip star.

Read more »

Scientists in a laboratory look at a computer screen with anticipation on their faces representing a potential change in the performance of ASX biotech shares in FY23
Healthcare Shares

Down 10% in a month, are CSL shares feeling the sting of a potential disruption?

Brokers are still bullish.

Read more »

One girl leapfrogs over her friend's back.
Healthcare Shares

Doubled in a year! Does this booming ASX share have another 24% upside?

Let's take a look.

Read more »