CSL Ltd (ASX: CSL) shares have been underperforming again in 2025.
Since the start of the year, the biotechnology giant's shares have lost 15% of their value.
While this is disappointing for shareholders, the team at Bell Potter thinks it could be a buying opportunity and sees potential for some big rewards.
Image source: Getty Images
What is the broker saying about CSL shares?
This morning, Bell Potter acknowledged that trading conditions have been tough for the company's Seqirus vaccines business. It said:
CSL's US flu vaccine business makes up ~8% of group revenue and ~10% of group earnings. Following a wave of vaccine-related regulatory leadership changes in the US in recent months, including the most recent overhaul of the CDC's vaccine advisory panel last week, we have tempered our Seqirus revenue growth forecasts. To be clear, we don't expect these regulatory changes to narrow CDC flu recommendations given their well-established safety record. Nevertheless, we view it more as a driver of broader negative sentiment/fatigue in the US likely to persist in the upcoming seasons.
Offsetting some of this is news that the company's Andembry product has been approved by the US FDA. It highlights that Andembry has a $3 billion market opportunity. The broker explains:
Moving to Behring, the FDA approval of Andembry for HAE opens up the US launch of CSL's most attractive near-term new product launch, in our view. The HAE market is ~US$3b currently and Andembry offers a convenience advantage of monthly dosing from the outset vs the initial fortnightly dosing of market-leader in Takhzyro, which currently holds ~50% market share.
Time to buy
In response to the above, the broker has trimmed its earnings forecasts slightly. However, it still expects double-digit earnings growth in the coming years. It said:
CSL has been challenged by several external uncertainties of late (tariffs headlines, US regulatory changes, MFN). Nevertheless, we consider the double-digit earnings outlook remains intact (on a reported basis). CSL is trading on a PE multiple of 21x, a hefty 32% discount to its 10-year average and we view this as overly punishing of the abovementioned factors. We have lowered our PT to $305 from $335, due to earnings reductions, increasing WACC to 8.0%, and reducing our PE multiple to 30x (from 32x). We maintain our BUY recommendation.
Bell Potter has a buy rating and $305.00 price target on CSL's shares. Based on its current share price of $240.21, this implies potential upside of 27% over the next 12 months.
To put that into context, a $10,000 investment would turn into $12,700 by this time next year if Bell Potter is on the money with its recommendation.
