CSL (ASX:CSL) share price backtracks despite renewed optimism

The CSL Limited (ASX: CSL) share price is wobbling today despite picking up steam over the past few months. We take a closer look.

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The CSL Limited (ASX: CSL) share price is wobbling today despite picking up steam over the past few months. This follows the global biotech giant’s steady recovery in plasma collections, particularly in the United States.

At the time of writing, CSL shares are swapping hands for $272.86, down 1.57%. It’s worth noting that, regardless of today’s drop, CSL shares have continued to gain ground when looking at its performance from early March.

Plasma collections normalising

A possible catalyst pushing the CSL share price higher more recently is investor confidence in the company’s plasma levels.

CSL’s efforts to restore its critical ingredient for producing life-saving therapies has taken a positive turn. The company believes that plasma collections are beginning to normalise due to its increased marketing spend on incentivising new and lapsed donors.

Particularly, centres across the United States and Mexico border have seen a good response rate, nearing pre-COVID plasma collection numbers.

However, university donation centres have slowed to a standstill. This is due to the shift in remote online studying. CSL predicts that these levels will return when COVID-19 vaccinations become more available to mass populations.

The company has undertaken a range of initiatives to entice people to donate blood. This includes using social media influencers, speeding up the donation sign-up and check-in process, and paying donors more for blood. The latter has increased from US$825 to US$1,100 for each new donors first 8 blood donations. Existing donors are also receiving higher payments to attract people coming back.

Local vaccine production opportunity

In other news also helping support CSL shares, the company has signalled its interest in producing next-generation vaccines in Australia.

As COVID-19 has highlighted, Australia is vulnerable to international companies producing mRNA vaccines and delivering them here onshore.

As a result, the federal government is in discussions with CSL about how to establish local mRNA manufacturing capacity.

Currently, the company is producing 1 million doses of the AstraZeneca vaccine per week. So far, 3.2 million Australians have been vaccinated from COVID-19, with CSL noting that 5.5 million vials have been released as of last week.

This comes in the backdrop of the Australian government signing a deal with Moderna Inc (NASDAQ: MRNA) for its COVID-19 vaccine.

CSL share price performance review

Since hitting a 52-week low of $242 in March this year, CSL shares have rebounded over the last few months. Interestingly, the company’s share price is at the same level the day it released its half-year results for FY21.

On valuation grounds, CSL is the third-largest company listed on the ASX, with a market capitalisation of $126 billion. That puts it just behind Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd(ASX: BHP).

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Aaron Teboneras owns shares of CSL Ltd. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Moderna Inc. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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