3 reasons to buy CSL shares today

Two investment experts expect a big turnaround for CSL shares in 2025.

| More on:
Two lab workers fist pump each other.

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

CSL Ltd (ASX: CSL) shares couldn't avoid the broader market sell-off on Monday.

Shares in the S&P/ASX 200 Index (ASX: XJO) biotech stock ended the day down 1.4%, trading for $276.42 apiece.

That sees CSL shares down 7.9% since this time last year, underperforming the 9.9% 12-month gains posted by the ASX 200. Modestly softening those losses for shareholders, the biotech stock also trades on a 1.4% unfranked trailing dividend yield.

With that lacklustre year of performance behind it, here's why these two investing experts are optimistic on the outlook for CSL in 2025 (courtesy of The Bull).

The bullish case for CSL shares

"CSL is a global biotechnology company," said Sequoia Wealth Management's Peter Day, who has a buy recommendation on CSL shares.

He added:

Its medicines treat haemophilia and immune deficiencies. Its vaccines prevent influenza. It provides therapies in iron deficiency and nephrology. CSL provides products to more than 100 countries.

Explaining his optimistic outlook for CSL stock, Day said, "The company has posted a significant increase in revenue during the past three years and delivered earnings growth that's compounding at double-digit rates."

Revenue and earnings growth count as the first reason you may want to consider buying CSL shares today.

As for the second reason, Day said, "CSL was recently trading on a modest and appealing price/earnings ratio, which provides valuation support at current levels."

At Monday's close, CSL was trading at a P/E ratio of approximately 32 times.

Time for a rebound?

Catapult Wealth's Dylan Evans also has a buy recommendation on CSL shares. And he's expecting a rebound for the ASX 200 biotech company after a long stretch of underperformance.

"The share price of this blood products company has been a disappointing performer," he said.

Evans noted that "The shares have fallen from $320.03 on February 3, 2020, to trade at $276.77 on January 30, 2025."

And he said this didn't appear to stack up against the company's financial performance.

Which is the third reason CSL shares look like a good buy today.

According to Evans:

The company generated full year 2024 net profit after tax of $2.75 billion at constant currency, up 25% on the prior corresponding period. CSL is a high-quality defensive stock, anticipating double digit earnings growth in fiscal year 2025 amid trading on a relatively modest earnings multiple.

The patience of long-term investors has certainly been tested, but we expect good returns going forward.

CSL reported its FY 2024 results on 13 August.

Atop growing profits, the company achieved revenue growth of 11% in constant currency to US$14.8 billion.

Motley Fool contributor Bernd Struben 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. 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

Cropped shot of an attractive young female scientist working on her computer in the laboratory.
Healthcare Shares

What does the Macquarie Hospital Claims Index mean for ASX 200 health insurance stocks?

Macquarie shares its view on Medibank Private and NIB Holdings.

Read more »

Two lab workers fist pump each other.
Broker Notes

What's JP Morgan's price target on CSL shares?

Are CSL shares undervalued or will they continue to underperform?

Read more »

Portrait, confidence and team of doctors in the hospital standing after a consultation or surgery. Success, healthcare and group of professional medical workers in collaboration at a medicare clinic.
Healthcare Shares

2 ASX healthcare stocks making huge moves on big news

These shares are getting investors excited today. But why?

Read more »

Man drawing an upward line on a bar graph symbolising a rising share price.
Healthcare Shares

Which ASX All Ords stock is up 15% on guidance upgrade?

Let's find out what is getting investors excited on Tuesday.

Read more »

A senior pharmacist talks to a customer at the counter in a shop.
Healthcare Shares

3 reasons why the Sigma Healthcare share price could be a buy

This business has a very exciting outlook.

Read more »

Young businesswoman sitting in kitchen and working on laptop.
Healthcare Shares

Why CSL shares could be a bargain buy at $240

Let's see what Bell Potter is saying about this blue chip.

Read more »

Cropped shot of an attractive young female scientist working on her computer in the laboratory.
Healthcare Shares

3 ASX companies that are global leaders

Numerous ASX companies have extended their reach beyond Australia to dominate in their fields.

Read more »

Three people in a corporate office pour over a tablet, ready to invest.
Broker Notes

Bell Potter just slapped a buy on this ASX 200 share offering a 30% return

Which stock is being tipped as a buy? Let's find out.

Read more »