Is the CSL (ASX:CSL) share price too expensive right now?

Let's take a closer look at the iconic Aussie biotech company's share price.

The CSL Limited (ASX: CSL) share price has had a rather interesting few years. It was only back in 2019 that CSL shares were at their peak 'growth reputation'. This was a blue chip ASX 200 company that seemed to give investors double-digit price rises year after year. Over the 3 years to February 2021, CSL shares delivered capital growth of approximately 185%.

Perhaps this is why CSL CEO Paul Perreault is now one of the highest-paid ASX CEOs, at least according to a recent article in the Australian Financial Review (AFR).

But the past year and a half has been a different story for CSL. And one shareholders would be pretty unfamiliar with. CSL has seemingly stopped growing.

Yes, the CSL share price has more or less gone nowhere since early 2020. On 17 January 2020, CSL shares were going for almost exactly the price they are going for at the time of writing – $300.40 a share.

The company also remains well below its all-time high of roughly $340 a share that we saw back in February 2020. It's even got quite a bit of headroom with its current 52-week high of $320.42 a share on the current pricing.

So perhaps CSL shares are still too expensive. That might explain why the CSL share price has been stuck in the mud for months now.

A doctor in a white coat sits at her computer with finger on mouth thinking about something in her office with medical equipment in the background.

Image source: Getty Images

Is the CSL share price too expensive?

Well, as my Fool colleague James covered earlier this month, one broker who doesn't think CSL shares are too expensive is Morgans. Morgans put out an 'add' rating on CSL a week or two ago with a 12-month share price target of $324.40 a share. That implies a potential upside of close to 8% over the next year or so.

Morgans remains bullish on CSL due to its recent FY21 earnings report, with the broker impressed by "its full year sales and profits [that] were stronger than expected despite facing tough trading conditions".

However, it does note that the more cyclical forces CSL faces, such as plasma collections and costs, may weigh on the company over the next few years.

At the current CSL share price, this healthcare giant has a market capitalisation of $136.77 billion, a price-to-earnings (P/E) ratio of 42.47 and a dividend yield of 0.98%.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended CSL Ltd. 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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