Despite putting on a gain of 32% so far this year, one leading broker believes that the CSL Limited (ASX: CSL) share price still has a lot more upside left in it.
Is now the time to invest?
According to a research note out of the equities desk at Macquarie, now is a great time to invest.
This morning the broker initiated coverage on the leading biotherapeutics company with an outperform rating and a $146 price target.
Based on its current share price, this price target implies potential upside of approximately 10%.
Due partly to opportunities in hereditary angioedema and haemophilia, analysts at Macquarie expect CSL to grow earnings by almost 60% between now and FY 2020.
In light of this impressive growth, Macquarie believes that CSL deserves to trade at a premium to both the market and its own historical average earnings multiple.
Should you invest?
I completely agree with Macquarie that CSL is a buy. As well as opportunities in hereditary angioedema and haemophilia, I also expects its fledgling Seqirus vaccines business to provide a boost to its earnings in the near future.
Overall, I feel confident that the company is more than capable of growing earnings at a strong enough rate to justify its shares trading at 32x estimated forward earnings.
As a result, I think it is up there with Ramsay Health Care Limited (ASX: RHC) as one of the best buy and hold healthcare shares on the market today.
