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Is CSL Limited the best stock on the ASX?

Fund managers are in no doubt that the best performer of the Top 100 ASX-listed stocks is blood plasma biotech CSL Limited (ASX: CSL).

Looks like they agree with me — in November 2012 I argued that it was “the best company in Australia.”

CSL took out the award for top listed Australian company at the Corporate Performance Awards in Sydney overnight. Fund managers applauded the company’s wise choice of acquisitions and dominance of its competitors.

The company has increased its market cap from $20 billion five years ago, to $34 billion currently. Sales have risen from $3.8 billion in 2008 to $5.5 billion in 2013, while earnings per share have jumped 54% from $1.71 to $2.62, thanks to rising profits and share buybacks. Over the past decade, shareholders have enjoyed an average annual return of 28.5%, according to Commsec.

Chief executive Paul Perreault attributes the company’s success to international expansion, clear strategy and focused approach.

Other winners include REA Group (ASX: REA), the owner of Australia’s premier property website, realestate.com.au, which picked up the award for top stock in the 100-200 ASX-listed stocks category. James Hardie (ASX: JHX) boss Louis Gries won the best chief executive award, while Ramsay Health Care (ASX: RHC) won the prize for best board.

Qube Holdings (ASX: QUB) picked up an award for best growth prospects in the next 100-200 listed groups, while Seek Limited’s (ASX: SEK) chief financial officer was rated the best in the top 100.

For CSL, the next ten years may well be as kind to shareholders as the past decade has been. CSL’s boss Mr Perrault says the company has affiliates in close to 30 countries, and there is still plenty of room for the company to grow both in developed and emerging markets.

CSL has shown that it cares about shareholders when it came to acquisitions in the past. After US competition regulators knocked back its US$3.1 billion bid for Talecris Biotherapeutics, the company handed much of the cash back to shareholders through share buybacks.

Foolish takeaway

CSL still gets my nod for the best ASX-listed company by a wide margin. At the current price of around $71.20, CSL is trading on a prospective P/E ratio of around 28 times, but that may be cheap if the company can continue to generate results like it has over the past five years.

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Motley Fool writer/analyst Mike King owns shares in CSL & Seek. You can follow Mike on Twitter @TMFKinga

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