Can the CSL share price push back above $300?

The biotech last traded there on September 9.

| More on:
Scientists working in the laboratory and examining results.

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

The CSL Ltd (ASX: CSL) share price hit a 52-week closing high of $312.15 on 23 July before turning to the downside.

Shares are down more than 6% in the past month, currently fetching $286.28 at the close on Monday.

Despite this volatility, some analysts believe there's a strong case for a recovery, with a path that could see the biotech giant's share price climb back above $300.

Created with Highcharts 11.4.3CSL PriceZoom1M3M6MYTD1Y5Y10YALL1 Sep 202330 Sep 2024Zoom ▾Sep '23Nov '23Jan '24Mar '24May '24Jul '24Sep '24Sep '23Sep '23Jan '24Jan '24May '24May '24Sep '24Sep '24www.fool.com.au

Why is CSL's share price down?

The CSL share price was heavily sold after its FY24 results. Added to that, its FY25 guidance came in weaker than expected, which saw investors unload shares en masse in the following weeks.

The ASX healthcare share now expects 5–7% revenue growth this year, which could pull down to 10–13% growth in net profit, respectively.

Interesting to see investors sell down a business projecting double-digit earnings growth in the coming 12 months. However, CSL's price-to-earnings ratio (P/E) is currently more than 36 times, even with the recent price declines.

There's a good chance some of the decline relates to the mismatch in forward expectations and the relationship between P/E multiples – which capture expectations by the price paid for $1 of a company's earnings.

Investors aren't willing to pay as high a price for a dollar of the company's earnings as they were previously.

CSL back above $300?

Despite these factors, several brokers have price targets set on the CSL share price above $300 per share.

For starters, those at Bell Potter believe CSL represents an attractive buying opportunity.

The broker's optimism stems from CSL's proven track record, high-quality operations, and solid product portfolio.

The company is also set to benefit from a period of margin recovery, which, analysts say could lead to stronger earnings growth in the next few years.

Bell Potter rates the CSL shares price a buy with a valuation of $316.50, above the threshold.

Meanwhile, Macquarie is similarly bullish, retaining a buy rating on the stock with a $330 price target.

The broker points to CSL's upcoming product developments, including its garadacimab therapy, which could start contributing to revenue next year.

Macquarie also sees the company continuing to generate market share gains thanks to its product offering.

CSL also secured a deal with the United States Government to expand its inventory of the MF59 adjuvant – part of its CSL Seqirus business.

The multi-year agreement, worth US$121.4 million to CSL, will bolster the biotech giant's pandemic preparedness.

The stock is rated a buy from consensus, according to CommSec data.

Foolish takeaway

While the CSL share price has seen recent headwinds, several brokers say the company's fundamentals could see it trade above $300 apiece again.

The stock is up more than 16% in the past year.

Should you invest $1,000 in Ishares Core S&p/asx 200 Etf right now?

Before you buy Ishares Core S&p/asx 200 Etf shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Ishares Core S&p/asx 200 Etf wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 7 February 2025

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended CSL and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Healthcare Shares

A man wearing a white coat holds his hands up and mouth open with joy.
Healthcare Shares

Guess which ASX healthcare stock is rocketing 25% on big UK news

Investors are sending this ASX healthcare stock rocketing on Friday. But why?

Read more »

two men shake hands on a deal.
Healthcare Shares

Can you guess which ASX 300 healthcare stock is rocketing 34% on takeover news

This share is rocketing on Friday after accepting a takeover offer.

Read more »

A young male ASX investor raises his clenched fists in excitement because of rising ASX share prices today
Earnings Results

Telix share price jumps 13% on FY24 profit surge

This pharma stock has delivered another stunning result. Here's what it reported.

Read more »

Health professional working on his laptop.
Earnings Results

2 ASX 300 healthcare shares making big moves on earnings updates

Let's see what these two shares reported on Thursday.

Read more »

Teamwork, planning and meeting with doctors and laptop for medical, review and healthcare. Medicine, technology and internet with group of people for collaboration, diversity and support in hospital
Healthcare Shares

2 ASX 200 pharmaceutical shares surging on big US news

Big news is getting investors excited on Wednesday. Let's find out what is happening.

Read more »

Bored man sitting at his desk with his laptop.
Healthcare Shares

The Cochlear share price hit a 52-week low last week, is it time to buy?

Is this an opportunity worth hearing about?

Read more »

A businesswoman exhales a deep sigh after receiving bad news, and gets on with it.
Earnings Results

Cochlear share price sinks 10% on half-year result disappointment

Let's see why investors are hitting the sell button this morning.

Read more »

Woman flexes muscles after donating blood.
Healthcare Shares

The CSL share price hit a 52-week low this week. Is it time to buy?

Is this beaten-up biotech a healthy opportunity?

Read more »