Are CSL shares at risk from the Trump tariffs?

How exposed are CSL shares to potential Trump medicinal tariffs?

CSL Ltd (ASX: CSL) shares are pushing higher today.

Shares in the S&P/ASX 200 Index (ASX: XJO) biotech stock closed Friday trading for $239.31. In late morning trade on Monday, shares are changing hands for $240.06 apiece, up 0.3%.

For some context, the ASX 200 is up 0.4% at this same time.

At current levels, CSL shares are still down 6.4% since 3 April, when news of United States President Donald Trump's global tariff campaign roiled global markets.

And with Trump having threatened to extend US tariffs to imported pharmaceuticals, a lot of ASX investors remain concerned that the biotech company could face more headwinds over the coming months.

But are those concerns overblown?

Health professional working on his laptop.

Image source: Getty Images

CSL shares and the Trump tariffs

Argonaut's Harrison Massey isn't overly concerned about the impacts of potential US tariffs on CSL (courtesy of The Bull).

"CSL remains Australia's largest listed pharmaceutical company and offers an excellent defensive position in any long-term portfolio," said Massey, who has a hold recommendation on CSL shares.

As for its size, CSL has a market cap north of around $116 billion, making it the third largest stock on the ASX. Following its remarkable share price gains over the past year, Commonwealth Bank of Australia (ASX: CBA) has taken the mantle of the biggest share on the ASX, with BHP Group Ltd (ASX: BHP) coming in at number two.

Commenting on those looming Trump tariffs and CSL shares, Massey said:

If the US Trump Administration imposes tariffs on imported pharmaceuticals, CSL should be relatively sheltered from the financial impacts of these impediments given its size and low earnings risk.

And while Massey maintains a hold rating on the ASX 200 biotech share, he does see the potential for share price gains.

"On May 8, CSL was trading well below previous highs, so there's ample room for a share price improvement on any positive news flow," he said.

Could the ASX 200 biotech stock surge 28% from here?

A number of prominent brokers forecast that some outsized gains could be made by investing in CSL today.

Goldman Sachs, for example, has a $307.30 price target on CSL shares. That's 28% above current levels.

On 10 April, the broker looked at the potential impacts of Trump tariffs on the Australian Healthcare sector, noting that "the manufacturing exposure for the pharmaceutical sector is highly diversified across regions".

As for CSL shares, Goldman said:

Our analysis suggests CSL could supply up to ~80% of its US IG sales from its Broadmeadows (Australia) plant with the expansionary capex phase across FY19-FY23 providing flexibility should the tariffs on pharmaceutical products diverge across regions.

We note the possibility of CSL lifting capex to increase its manufacturing presence in the US to maintain long run market leadership in light of its key competitors established presence in the region.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended CSL and Goldman Sachs Group. The Motley Fool Australia has recommended BHP Group and CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Healthcare Shares

Male and female scientists analysing data on a computer.
Healthcare Shares

Should I invest $2,000 into Mesoblast shares?

I look at whether commercial progress has made this long-awaited biotech story worth investing in today.

Read more »

Two colleagues looking at a graph and comparing share prices.
Healthcare Shares

Pro Medicus vs Telix Pharmaceuticals: Which is more likely to double your money in 2 years?

Can Pro Medicus or Telix Pharmaceuticals double your money on the ASX? We stack up their value, growth, and price…

Read more »

Happy doctor using her laptop.
Healthcare Shares

CSL has a new CEO. Are its shares a buy?

I look at what the incoming CEO could bring to the business as its recovery continues.

Read more »

Man holding a calculator with Australian dollar notes, symbolising dividends.
Healthcare Shares

Forget term deposits! I'd buy these ASX dividend shares instead

Term deposits are not exciting to me because of one key reason.

Read more »

A sobbing businessman accused of wrongdoing faces justice
Healthcare Shares

CSL responds to class action, defends disclosure record

The CSL share price is under the microscope after it revealed it will defend a newly filed class action lawsuit.

Read more »

Happy businessman fist pumping while looking at a tablet.
Healthcare Shares

Up 13%: Why is everyone buying Pro Medicus shares this week?

The ASX healthcare shares jumped another 3% on Wednesday.

Read more »

healthcare worker overseeing group of aged care residents at table
Healthcare Shares

Regis Healthcare vs Ryman Healthcare: Which under-the-radar ASX small-cap could double from here?

We compare Regis Healthcare and Ryman Healthcare shares to find out which aged care small-cap could bounce back faster.

Read more »

Smiling female CEO with arms crossed stands in office with co-workers in background.
Healthcare Shares

CSL names Deborah Waterhouse as next CEO in global search

CSL has appointed Deborah Waterhouse as its next CEO, signalling continuity and experience as it moves into its next growth…

Read more »