The CSL Limited (ASX: CSL) share price has been one of the best performers on the local share market this year.
As of yesterday's close, the biotherapeutics company's shares had put on a year-to-date gain of 32%.
Is it too late to invest in CSL?
I don't think it is. While it is no longer the bargain buy it was at the start of the year, I still see a lot of value in its shares today.
Based on its FY 2018 forecast for net profit after tax in the range of US$1,480 million to US$1,550 million, I estimate it shares to be changing hands at approximately 30x forward earnings at present.
I think this is reasonable given its high quality business and strong long-term growth prospects.
With demand for its immunoglobulin and specialty products growing strongly, the recent approval of its Haegarda product, its fledgling Seqirus influenza business close to being profitable, and margins expanding, I believe CSL has the potential to deliver above-average earnings growth for the next decade.
I'm not alone in thinking this way. Last week analysts from the equities desk at Macquarie initiated coverage on CSL with an outperform rating and $146 price target.
This price target implies potential upside of over 10% from the last close price.
According to the note, the broker expects opportunities in hereditary angioedema and haemophilia to be the driver of strong earnings growth over the next few years.
I agree with this view and believe it makes CSL one of the best buy and hold investment options in the healthcare sector alongside the likes of Ramsay Health Care Limited (ASX: RHC) and Nanosonics Ltd. (ASX: NAN).
