The CSL Limited (ASX: CSL) share price was back on form on Thursday.
The biotherapeutics giant’s shares ended the day 3% higher at $302.83.
Why did the CSL share price push higher?
Today’s gain by the CSL share price appears to have been driven by a broker note out of Morgans.
According to the note, the broker has retained its add rating and lifted its price target on the company’s shares by 8% to $324.40.
Based on the latest CSL share price, this price target implies potential upside of 7%.
What did Morgans say?
Morgans was pleased with CSL’s “solid” FY 2021 results, noting that it beat both on the top and bottom lines.
For the 12 months ended 30 June, CSL deliver a 9.6% increase in revenue to US$10,310 million and a 10% lift in net profit after tax to US$2,375 million. This compares to Morgans’ estimates of US$9,816 million and US$2,174 million, respectively.
The highlight for the broker was the company’s Seqirus business. It recorded strong sales and earnings growth thanks to increased demand for seasonal flu vaccines.
Morgans commented: “Seqirus was the standout, on strong demand for influenza vaccines, while Behring was more modest, as Albumin gains on transition to a direct China distribution and cost-outs were offset by Ig/Specialty/Haemophilia growth flattish to down.”
And while the broker notes that FY 2022 will be a transitional year and that plasma collection headwinds continue, it remains positive on the company.
“Improving plasma collections are a prelude to a steepening earnings trajectory, but timing is everything, with a lengthy manufacturing cycle (9-12mos), higher costs and ongoing COVID pandemic, adding uncertainty for a quick turnaround.”
“We view CSL as a core holding and best positioned among its peers to meet growing patient demand, but the near term remains challenged, with timing uncertainty around a full recovery in plasma collections and increasing costs,” it concluded.
The CSL share price is up 6% in 2021.