Should ASX investors buy the dip in the CSL share price?

The biotech is down 9% so far in 2022.

| More on:
A young woman wearing a red and white striped t-shirt puts her hand to her chin and looks sideways as she wonders whether to buy NAB shares

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • CSL shares are down by 9% year-to-date 
  • Brokers are constructive on the company and reckon there's plenty of growth to come
  • CSL finished the session on Thursday at $264.95 per share 

The CSL Limited (ASX: CSL) share price finished the session in the green on Thursday at $264.95, up 0.76%. For many years, this blue-chip behemoth has been a star performer of the ASX. Over the five years leading up to the COVID-19 market meltdown in March 2020, CSL stock ascended by almost 200%.

The pandemic has sent this ASX biotech share on a rollercoaster ride. In the past 12 months, CSL shares reached a 52-week high of $319.78 in November 2021. They then took a tumble to a 52-week low of $240.10 in February. In the year to date, the CSL share price is down by 9%.

Which begs the question: Should you buy the dip?

TradingView Chart

A 9% discount year-to-date

A 9% dip might not sound significant for an expensive stock like CSL but consider this. Before the pandemic, the CSL share price peaked at an all-time high of $342.75 — which might make today’s price of $264-ish look a little different in terms of a potential buying opportunity.

And here’s what the experts have to say.

Analysts at Citi recently retained their buy rating on CSL and valued the company at $335 per share. That’s an enormous price target that signifies a 26% total shareholder return if it were to eventuate.

“Over the next six months, we expect the market to focus on the strong underlying plasma market demand, and the closure of the Vifor deal, both of which should lead to strength in the share price,” the broker commented in a recent note.

Citi joins an extensive list of analysts advocating CSL, with 87% of coverage saying buy and just 12.5% saying sell. The consensus price target is $316.60, so Citi sits above the consensus with its analysis. So does Macquarie.

What does Macquarie think of the CSL share price?

The broker is bullish on CSL and reckons there will be a strong growth trajectory until FY24, given a variety of catalysts.

It recently noted that CSL’s acquisition of Vifor Pharma lends the biotech giant opportunities in the iron deficiency and kidney disease segments. Not only that, but the Vifor buy enables CSL to diversify into new markets whilst adding new opportunities for research and development (R&D).

It prices CSL at $327 per share on a buy rating, aloft consensus, but not too far off the share’s 52-week high of $319 in November.

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Healthcare Shares

a young woman props her hand under the face as she pokes her head out from under a luxurious doona in a bedroom decorated with flowers and a stylish lamp.
Healthcare Shares

Resmed share price dips despite profit and dividend boost

Profits and dividends are up, so why is the Resmed share price down?

Read more »

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

Avita share price dives 16% on net loss

The medical technology company's shares are falling following today's financial results

Read more »

A man waking up happy with a smile on his face and arms outstretched representing the hefty Adairs dividend yield
Earnings Results

ResMed share price on watch following solid FY22 growth

ResMed has released its full year results...

Read more »

Female doctor with a mask holds out hand in a stop gesture.
Capital Raising

Up 90% in 2 weeks, here’s why the Paradigm share price has been halted

The biopharmaceutical company is planning a capital raise.

Read more »

A doctor appears shocked as he looks through binoculars on a blue background.
Broker Notes

Goldman Sachs gives its verdict on the CSL share price

Where next for CSL's shares?

Read more »

Healthcare Shares

Mayne Pharma share price rockets 25% on $680 million payday

It's been a good day for the ASX pharmaceutical company.

Read more »

Two researchers discussing results of a study with each other.
Healthcare Shares

What’s with the Polynovo share price on Wednesday?

Shares in the ASX medical devices company hit their year to date high today before retreating again.

Read more »

A man in a wheelchair stretches both arms into the air in success.
Healthcare Shares

Imugene share price lifts 11% on clinical trial update

Imugene shares are flying higher today.

Read more »