Top broker says CSL Limited (ASX:CSL) shares are in the buy zone

A top broker has tipped the CSL Limited (ASX:CSL) share price as a buy. Here's what you need to know…

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The CSL Limited (ASX: CSL) share price has dropped lower in early trade after going ex-dividend this morning for its final dividend of approximately 127.8 cents per share. At the time of writing the global biotech company's share price is down 1% to $210.16.

But as far as one leading broker is concerned, this decline could be a buying opportunity for investors.

According to a note out of the Macquarie Group Ltd (ASX: MQG) equities desk, its analysts have been busy reviewing the medium term outlook for CSL.

The broker found CSL to be well-positioned to continue to meet and benefit from the increasing immunoglobulin demand through its roll out of plasma collection centres.

Last month management advised that it would open 30 to 35 plasma collection centres in FY 2019. This compares to the 27 centres opened in FY 2018, which brought its total collection network to 206 centres.

In addition to this, the broker is pleased with a favourable shift in mix and the solid growth in higher margin Idelvion and Haegarda products.

All in all, this has led to the broker retaining its outperform rating and increasing the price target on its shares from $223.50 to $230.00. The new price target implies potential upside of approximately 9.5% from the current share price.

Should you invest?

I agree with Macquarie on this recommendation and think CSL would be a great investment, especially if you are prepared to hold onto its shares for the long-term.

I believe CSL is the highest quality company on the local market and positioned perfectly to continue its solid earnings growth for many years to come. I expect this to more than justify the premium its shares trade at today.

As well as CSL, I think fellow healthcare shares Cochlear Limited (ASX: COH) and ResMed Inc (ASX: RMD) would be great options for buy and hold investments.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Cochlear Ltd. and ResMed Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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