Why did the CSL (ASX:CSL) share price go backwards in February?

CSL shareholders have seen their 2021 gains evaporate…

Key points
  • CSL shares have erased gains of last year and are now down 10% since the start of 2022
  • After a mixed set of results, the market punished the global biotech in February, sending shares further into the red
  • In the last 12 months, the CSL share price has fallen by 3%. It has not recovered since sinking in December

The CSL Limited (ASX: CSL) share price quietly walked into the green today and finished 0.43% higher at $261.10.

That might come as some relief to CSL shareholders who have seen gains achieved in late 2021 evaporate. CSL shares are now trading 10% in the red this year to date.

While the biggest fall came in January, February wasn't much kinder to the CSL share price which continued to edge lower, falling around 0.5% in that time.

A sad looking scientist sitting and upset about a share price fall.

Image source: Getty Images

What happened to CSL last month?

CSL reported a mixed set of results at its earnings release in February. The global biotech recognised a slight increase in group revenue to almost US$6 billion, but looking closer, CSL Behring saw a 2% decrease.

It was profitability that suffered last half for CSL, however, as net profit after tax (NPAT) declined by 5% in constant currency terms to US$1.7 billion.

Not only that, new guidance now bakes in a US$90–$110 million transaction cost related to CSL's recent purchase of Vifor Pharma, potentially hindering the outlook from investors.

Now the market has had time to digest the company's results the CSL share price has faltered. It finds itself trading well below its February highs of $277 that it reached, funnily enough, the day following earnings.

However, the CSL share price has been heading south since November last year, around the time when rumours surfaced it was buying Vifor for $10 billion.

Plus, when scoping out the wider sector, it's clear that ASX healthcare shares have taken a hit these past three months.

Overlying CSL's price chart on the S&P/ASX 200 Health Care index (ASX: XHJ) reveals the two have moved in similar fashion over this time, as seen below.

TradingView Chart

Even as both CSL and the index attempted to rally in mid-February, the market saw otherwise and continued to send the pair back down south as of today.

Plus, with the wave of macro-economic crosscurrents feeding into global equity markets right now, it's not surprising to see this kind of chart pattern across the board in Australian shares.

However, as a prudent investor, one should always keep a long-term horizon in mind and consider consulting a financial professional during these times to help make the most informed decisions possible.

CSL share price snapshot

In the last 12 months the CSL share price has fallen by 3%. It has tried to stage a comeback since collapsing in December but has been unable to break through the resistance level.

As such CSL shares are now trading at April 2021 levels which is also where the biotech was trading at in late 2019, right before the onset of the pandemic.

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns 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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