Could you turn short-term pain into long-term gain with CSL shares?

CSL shares were the third most popular stock purchased by high-net-worth baby boomers in FY23.

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CSL Limited (ASX: CSL) shares are down 0.37% to $267.08 apiece at lunchtime on Thursday.

The broader market is struggling with the S&P/ASX 200 Index (ASX: XJO) down 0.49% or 36 points.

This follows a 348-point drop or 0.98% for the Dow Jones Index (INDEXDJX: .DJI) overnight — the worst session since May, according to CNBC, following stronger-than-expected jobs data.

CSL shares have been languishing in 2023, down 5.22% in the year to date, while the ASX 200 is up 5.3%.

Should you be taking advantage of the weakness in this ASX 200 blue chip for long-term benefits?

CSL shares among top stocks bought by high-net-worths in FY23

You might have heard the term, 'follow the smart money'.

Well, if you believe that to be true, then CSL shares are an obvious buy right now.

According to data from trading platform Selfwealth Ltd (ASX: SWF), CSL shares were the third most popular stock purchased by high-net-worth baby boomer clients in FY23 (courtesy theage.com.au).

The data canvassed the trading activity of clients with portfolios worth more than $1 million.

Over the past year, CSL shares have traded between a low of $255.87 and a high of $314.28.

More than a dozen experts backing CSL

As we recently reported, 12 top brokers are recommending CSL shares for investment right now.

A 13th expert, DNR Capital chief investment officer Jamie Nicol, added his support for CSL this week.

As we reported on Tuesday, Nicol said in a DNR video blog post:

What we are seeing in terms of opportunities is that uncertainty is driving some good quality companies to trade at discounts.

This environment has provided a rare opportunity to invest in good quality businesses that perhaps are getting disrupted through [a] hiccup in earnings, change in CEO, or a range of events…

Investors can pick up some of those businesses at really good discounts.

Rising and falling

On several occasions during FY23, the healthcare giant rose above the $300 threshold but failed to hold at that level.

This has given investors several opportunities to buy at depressed levels.

Nicol says CSL has some short-term challenges but "the longer term trajectory still looks very good".

Nicol said:

They've had a change of the CEO. 

They did have a downgrade to near term earnings which was all about the recovery and earnings post-COVID, and perhaps the recovery is taking a little bit longer than what they initially expected.

CSL downgraded its FY23 guidance in June due to foreign currency headwinds.

Still, the biotech estimates a 13% to 18% annual increase in its net profits after tax and amortisation (NPATA) in FY24. The guidance range is now approximately US$2.9 billion to US$3 billion.

Nicol added:

We always like to buy in periods of uncertainty, particularly when we are unclear on what the macro framework looks like.

We look for quality characteristics, good management, good businesses, good industry structure, competitive advantages, good ability to earn strong margins over the longer term because the market tends to gravitate back to those companies over time.

Citi and UBS have a buy rating on CSL shares and the highest 12-month price target of the bunch at $340.

Morgans says CSL shares are "poised to break out this year". The broker has an add rating and a $323 share price target.

Long-term gains produced by CSL shares

While past performance is no guarantee of future performance, CSL has an incredible history.

Since listing in 1994, the ASX 200 stalwart has gone up by 5,617%.

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Bronwyn Allen has positions in CSL. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. 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 Scott Phillips.

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