CSL Ltd (ASX: CSL) shares have delivered some outperforming gains over the past year.
Over the past 12 months, shares in the S&P/ASX 200 Index (ASX: XJO) biotech stock are up 13.3%, outpacing the 10.4% gains delivered by the ASX 200 over this same time.
And CSL shares also trade on a 1.3% unfranked dividend yield (partly trailing, partly pending).
Indeed, following some strong FY 2024 results released on 13 August, management increased the full year's dividend payout by 12% from FY 2023.
Other highlights from the company's full-year results included an 11% increase in revenue (in constant currency) to US$14.8 billion. And net profit after tax before amortisation (NPATA) in constant currency was up 15% to US$3.01 billion.
As for what could impact CSL shares in the year ahead, management forecasts FY 2025 NPATA (in constant currency) will come in the range of US$3.2 billion to US$3.3 billion. That's up between 10% to 13% from FY 2024 profits.
But with the ASX 200 biotech share increasingly embracing the fast growing powers of artificial intelligence (AI), future profits may grow considerably faster as digital brains turbocharge efficiencies and bring down costs.
Image source: Getty Images
CSL shares could get a significant AI boost
CSL spends more than $1 billion annually researching and developing new drugs.
According to CSL vice-president of research Michael Wilson, the dawn of AI could reduce the time it takes a researcher to pore through the reams of data that go into each new potential drug candidate from a year to a matter of seconds.
Those are the kinds of efficiencies that could offer an ongoing boost for CSL shares.
"What's really changing the pharma and biotech industry is that we have a lot more data to work with now. We have much better computing power," Wilson said (courtesy of The Australian).
"We know that if we don't invest in this area, we're going to end up a long way behind," he added.
According to Wilson:
We focus very hard on trying to determine what are the drugs that are going to be the most effective for our patients. Insights as early as possible are really key to that because on average for every dollar in research it's $10 in development, so they're big decisions that you're making.
So any way you can move the needle on the probability of success, that's a very important factor. You're not wasting patients' time and effort as well.
As for how the company's research team is employing AI to potentially help boost CSL shares, Wilson said, "definitely in drug design, and then also in thinking about the patient groups that we want to go after and that we think where our drugs will have applications".
Though still in its early days, Wilson sees a lot of potential benefits arising from AI. He said:
AI is an emerging enabling technology finding great utility in applications across the biomedical sector, from rapid drug discovery to optimisation of drug manufacturing processes, accurate disease diagnosis, and AI-guided clinical trial recruitment and design.
