It has been a tough 12 months for the CSL Ltd (ASX: CSL) share price.
During this time, the biotechnology giant's shares have tumbled over 30% to $207.82.
Although this is disappointing, it isn't often that a quality company like this trades at such a discount.
So, could this be a good option for a $5,000 investment? Let's find out.
$5,000 invested in the CSL share price
The good news is that a number of leading brokers believe that there could be big returns on offer here for Aussie investors.
For example, according to a note out of Macquarie Group Ltd (ASX: MQG) its analysts have put an outperform rating and $295.90 price target on its shares. This implies potential upside of 42% for investors over the next 12 months.
This means that a $5,000 investment would turn into approximately $7,100 if Macquarie is on the money with its recommendation. It said:
Despite downgrades to earnings, we view today's price movement as an overreaction. Incorporating more conservative FY26 forecasts compared to guidance, we see the current valuation as undemanding (trading at P/E ~20x with ~10% EPS growth). Outperform.
Elsewhere, the team at Morgans is equally bullish on the investment opportunity here. The broker highlights that CSL is positioned to deliver "double-digit earnings growth over the medium term." In light of this, it thinks its shares are undervalued at current levels.
Morgans has a buy rating and $293.83 price target on its shares. Based on the current CSL share price, this suggests that upside of 41% is possible between now and this time next year.
This would turn a $5,000 investment into approximately $7,050 in a year if the broker's recommendation delivers the goods. It said:
FY25 results were broadly in line, with double-digit underlying earnings growth, solid operating leverage and strong OCF. Behring was softer (+6%; hit by cUS$100m Medicare Part D reform), but margins gained on efficiencies (GPM +130bp, 51%; OPM +100bp, 42.2%), with Vifor showing resilience (+14%), while Seqirus was soft (-9%) on weak immunisation rates.
As widely anticipated, CSL flagged a restructuring, streamlining R&D and commercial productivity, targeting US$500m pre-tax savings by YE28, but surprised with Seqirus demerger and multi-year share buyback (US$500m FY26). While investors have taken a glass half full approach, we believe the restructuring augments, not masks the underlying business, with streamlining operations and cost savings supporting double-digit earnings growth over the medium term. We adjust FY26-27 forecasts modestly, with our PT decreasing to A$293.83. BUY.
