CSL Ltd (ASX: CSL) shares have continued their downward momentum yet again in Tuesday afternoon trade.
At the time of writing, the beaten-down ASX biotech stock has fallen another 2.53% to $128.48, marking the lowest trading price since August 2017.
The shares are down 25% for the year to date and 47% lower than this time last year.
For context, the S&P/ASX 200 Index (ASX: XJO) is down 0.55% at the time of writing, and down 0.1% for the year to date.
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Why are CSL shares still falling?
ASX healthcare shares have lagged most other sectors on the index this year after a sharp, broad-based sell-off.
Investors have shied away from healthcare shares this year and instead repositioned themselves towards ASX energy stocks, resources, and defensive assets.
At the same time as a sector-wide sentiment shift, investors have also lost confidence in CSL as a business.
The biotech company was once widely regarded as one of the most dependable growth stocks on the ASX. But over the past few years, it has experienced a notable slowdown in earnings growth and operational challenges. More recently, CSL has faced headwinds such as lower vaccine demand, a surprise restructure, and even a shock CEO exit.
And the headwinds keep coming, too.
Earlier this month, CSL was hit by fresh policy changes out of the US. News that the US military has scrapped its annual flu shot requirement for service members significantly changes the demand outlook for CSL. The company generates a large portion of its revenue from the US, with its influenza vaccines forming part of that exposure.
Now investors are worried that lower vaccine uptake could weigh heavily on CSL's future sales, especially in its segments where demand was driven by mandates.
Does this mean it's time to sell my shares?
CSL shares are still struggling to stabilise, and confidence has been crushed. But I think that calling it quits on the biotech shares still looks premature.
While the company's vaccine segment looks to be facing some new headwinds, it isn't the core profit area for CSL.
The bulk of CSL's profits and earnings come from its plasma therapies division, CSL Behring. This segment includes plasma-derived medicines, including immunoglobulins, albumin, and clotting factors. The company's blood plasma division dominates the market for rare blood disorders and immunoglobulin products. Demand in this sector is growing significantly.
What do analysts expect next from CSL?
Analysts continue to be very bullish on the outlook for CSL shares. TradingView data shows that 12 of 18 analysts have a buy or strong buy rating on the stock, with an upside of up to 109% to $268.84 per share over the next 12 months.
Even the minimum $153.06 target price implies a 19% upside at the time of writing.
