It has been a week to forget for the CSL Ltd (ASX: CSL) share price.
The release of a surprisingly disappointing full year result has put significant pressure on the biotechnology company's shares and sent them crashing to a 52-week low.
Does this weakness make them a no-brainer buy? Let's find out what one broker is saying.
What is the broker saying?
According to a note out of E&P, its analysts were disappointed with the quality of CSL's earnings in FY 2025. They said:
CSL's FY25 result was in line with expectations at NPATA, but earnings quality disappointed with a weaker gross profit result offset by R&D cuts and a low tax rate. The same was true of new FY26 NPATA guidance; it's in line with pre-result consensus but relies on cost out to offset weaker sales and gross profit.
The key CSL Behring business was to blame. Its sales were softer than forecast and its margins did not improve as much as expected. Unfortunately, future margin improvements have been pushed back.
It points out that the key CSL Behring business was behind the weakness. Unfortunately, management has also pushed back its margin improvement guidance. The broker adds:
Behring drove the gross profit shortfall in 2H25 and into FY26, with sales more heavily affected than expected by the US Medicare Pt D redesign (-1.9% vs. our -1.0%), and the loss of several ex-US Ig tenders (-3–4% sales impact in FY26). Margins were lower for several reasons, most notably the Medicare Pt D impact which is all margin, and additional investment in headcount for the Rika/i-nomogram rollout.
CSL also stepped away from previous Behring GP margin guidance; they still expect to get there, all the levers are still in place, but they are no longer committing to timing (i.e. it's likely been pushed out).
But it wasn't all bad news. E&P notes that "CSL unveiled a strategic transformation program including: (i) incremental US$500-550m cost out by FY25, approx. 50% of which will be reinvested for growth."
Is the CSL share price good value?
E&P is recommending CSL shares as a buy and has a positive rating and a trimmed price target of $294.21 on them.
Based on its current share price of $220.74, this implies potential upside of 33% for investors over the next 12 months.
Commenting on its recommendation, it said:
The key question is whether Behring's weak 2H25 signals structural pressure or a temporary setback. Management insists it's the latter, although medium-term Ig growth expectations have effectively eased to mid-to-high single digits (still respectable). At this stage, we retain our view the industry can adjust to manage over-supply risks (i.e. lower collections including 3P). On balance, we see the sell-off as a potential buying opportunity. Retain Positive rating.
