CSL Ltd (ASX: CSL) shares have been under pressure in September.
So much so, the biotechnology giant's shares have fallen over 6% since this time last month. As a comparison, the ASX 200 index is up approximately 1% over the same period.
This has been driven by softer than expected guidance for FY 2025, which spooked investors. Though, it is worth remembering that CSL is often conservative with its guidance, so don't be surprised if it is upgraded as the year progresses.
With that in mind, is now a good time to snap up the company's shares? Let's see what one leading broker is saying.
Is it time to buy CSL shares?
According to a recent note out of Bell Potter, its analysts have named CSL on their Australian equities panel again this month.
It notes that this "panel of favoured Australian equities offer attractive risk-adjusted returns over the long term." The broker considers "the current macro-economic backdrop and investment environment, focusing on quality companies with proven track records, capable management and competitive advantages."
CSL ticks all of the these boxes in September and features on the panel. Commenting on the company, the broker said:
CSL is one of the world's largest global plasma fractionators. The plasmaproducts themselves have proven excellent medical products, with wide application, and deliver therapeutic outcomes difficult to achieve by other means. The company has a proven track record of deploying capital effectively and generating high returns over the past 25 years.
Its analysts believe that a buying opportunity has now opened up for investors with CSL shares. It adds:
CSL presents an attractive buying opportunity as we anticipate the start of a margin recovery phase for CSL, driving above-market earnings growth over the next few years. CSL trades at a 12-month forward PE of ~31x, representing a discount to its 5 year average of ~35x. Furthermore, the company will continue to deleverage the balance sheet over the next few years. Given the company's proven quality and growth prospects, we believe significant upside remains.
Buy rating
The note reveals that Bell Potter has a buy rating and $316.50 price target on the company's shares right now.
Based on the current CSL share price of $290.04, this implies potential upside of 9.1% for investors over the next 12 months.
In addition, a modest 1.5% dividend yield is expected by the broker in FY 2025. This lifts the total potential return on offer with its shares to approximately 10.5%.
