CSL Ltd (ASX: CSL) shares may finally be showing signs of life.
The biotechnology giant has climbed 9% over the past month. That's a significant move for a stock that has spent much of the past year under relentless selling pressure.
Even after that bounce, however, CSL shares remain down roughly 55% over the past 12 months.
That leaves investors with a big question: has the $50 billion ASX share finally turned the corner, or is this just another head fake in a painful downtrend?
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Investors are starting to buy the dip
The first thing worth noting is that sentiment appears to be improving.
CSL shares were hammered throughout May, falling around 23% during the month before sliding further in early June. But after such a dramatic sell-off, bargain hunters appear to be stepping in.
After plunging 38% in 2026 alone, many investors may now believe the worst-case scenario is already reflected in the share price.
That's not an unreasonable view.
CSL remains one of Australia's highest-quality healthcare companies, with leading positions across plasma therapies, vaccines, and kidney care. It also benefits from powerful long-term trends, including ageing populations, rising healthcare spending, and increasing demand for specialist treatments.
Importantly, these structural growth drivers haven't disappeared just because the share price has.
But risks remain
Of course, there's a reason CSL shares have been under pressure.
The healthcare company has faced weaker earnings expectations, integration challenges following major acquisitions, and ongoing questions about profitability across parts of the business.
Investors are also watching closely to see whether management can successfully execute its transformation program while restoring earnings growth.
And while the recent rally is encouraging, one month does not make a trend. If earnings disappoint again or operating conditions worsen, CSL shares could easily come under renewed pressure.
That's why some investors remain cautious despite the sharp decline.
What do analysts think?
Analysts appear divided on the near-term outlook, but most still see upside ahead.
A recent note from UBS revealed that its analysts retained a buy rating on CSL shares, albeit with a reduced price target of $158. UBS believes 2026 could mark the low point for the company's earnings cycle.
The broker expects cost savings from CSL's transformation program and lower plasma collection costs to support stronger earnings growth in FY2027.
TradingView data paints a similar picture. Of the 18 analysts covering CSL, 10 currently rate the stock as a hold, while the remaining eight have buy or strong buy recommendations.
The average price target sits at $138.89, implying potential upside of approximately 30% from current levels.
That said, there remains considerable disagreement. Some analysts believe CSL shares could slip around 3% to $103.02, while the most bullish forecasts point to gains of roughly 84% and a share price of $196.76.
Foolish Takeaway
CSL shares are no longer in freefall, and investors appear increasingly willing to look beyond today's challenges.
The company still possesses world-class assets, strong competitive advantages, and attractive long-term growth drivers. However, execution risks remain and earnings recovery is far from guaranteed.
For investors willing to take a long-term view, the recent weakness may present an opportunity. For more cautious investors, waiting for clearer signs of an earnings turnaround could still be the prudent approach.
