The CSL Ltd (ASX: CSL) share price opened trading at $283.70 apiece on Tuesday, having largely tracked sideways for the last three months of business. Meanwhile, the broader S&P/ASX 200 Health Care Index (ASX: XHJ) has followed a similar path, up just 1.2% in that time.
CSL shares have a history of delivering market-beating returns over the long term. But investors haven't bid up the biotechnology giant's stock in the past two to three years of trade. Now that we're well past the "pandemic era," what's next?
Let's take a look to see if the CSL share price can break the $300 barrier by the end of 2024.
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Fundies like CSL share price
ECP Asset Management is one fund manager that appears bullish on CSL. Speaking to The Australian Financial Review in April, portfolio manager Sam Byrnes said the $2.9 billion asset manager likes CSL's prospects.
"We are very positive on the outlook for CSL", he said, noting the biotech is "now seeing volume growth alongside a decrease in the cost of plasma collections".
"Capex is set to reduce 30 % this year and its future growth will be less capital intensive with the introduction of more efficient plasma collection devices and a yield enhancement program".
These factors, Byrnes says, should increase CSL's return on capital over the next five years. "We'd be happy with $500 [per share] in five years", he concluded.
CSL share price above $500?
ECP's Byrnes alludes to Macquarie's $500 per share target for CSL over the next three years, as covered by my colleague Bernd.
The mammoth valuation, set in April, was built on strong earnings growth in the Behring business. This is expected to drive around 90% of CSL's profits in the next five years, it says.
Macquarie has a price target of $330 per share on the CSL share price in the short term.
Meanwhile, analysts at Morgans and UBS are both optimistic about CSL's future.
According to my colleague James, Morgans added CSL to its best ideas list. It cites potential double-digit earnings growth from increased plasma collections and new product approvals.
Morgans has an "add" rating with a price target of $315.40, suggesting a potential upside of 11.17% from the current share price. UBS also retained its buy rating and a $330 price target. It too likes the growth in CSL's plasma collections market.
Not all roses
Not everyone views CSL through rose-coloured glasses. Atlas Funds Management chief investment officer, Hugh Dive is one. The fund manager likes CSL — no debate — and has owned the stock for more than six years, according to The Australian Financial Review. But he is a little more cautious.
Dives—who did not provide a price target—said that while growing earnings by 10% per year is "achievable in the short term," it remains "extremely difficult over a long period of time."
He added that "the law of large compounding numbers" could make it difficult for CSL to grow earnings that fast—not "without some degree of high sustained inflation."
Foolish takeaway
With analysts' positive outlook and strategic advancements in plasma collection, CSL appears well-positioned to grow earnings in the next three years, in my opinion.
The consensus among experts suggests that the CSL share price could indeed surpass $300 by the end of 2024, with significant long-term growth potential beyond that.
Regardless of these views, it is essential to remember that investing comes with risks. So, make sure to consider your own personal financial circumstances as well.
