After a rough couple of years, CSL Ltd (ASX: CSL) is getting some attention from Australia's fund managers.
According to The Australian, new research from Morgan Stanley shows fundies been making some interesting changes to their portfolios.
And CSL is one of the stocks they've been buying.
CSL shares are currently down 0.40% to $178.41 in morning trade, following yesterday's close of $179.12.
So, what are fund managers seeing in CSL?
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CSL takes the top spot
Morgan Stanley's research found healthcare extended its lead as the most favoured sector among Australian active fund managers during August.
CSL saw a significant increase in fund holdings, pushing it into the top spot among active positions.
An active overweight means a fund holds a larger weighting in a stock than it has in its benchmark index.
But it was a different story for some of the other bigger companies.
Managers remained underweight financials, particularly the major banks, although insurance stocks continued to attract interest.
In resources, managers increased their underweight position in BHP Group Ltd (ASX: BHP).
They also reduced their overweight exposure to Rio Tinto Ltd (ASX: RIO), while adding to gold holdings.
What's behind the buying?
CSL's latest results might help explain some of that interest, although there's still plenty of work to do.
Its FY26 results showed revenue of US$15.8 billion, down 1% in constant currency.
Underlying NPATA fell 2% to US$3.1 billion, while restructuring costs and impairments contributed to a US$2.6 billion statutory loss.
But the business still managed to generate US$3.5 billion in operating cash flow.
CSL also completed an $1 billion share buyback during FY26 and announced another program worth up to $1.15 billion.
There's also continued demand for immunoglobulin treatments, while sales of newer therapies Andembry and Hemgenix are growing.
Andembry generated US$240 million in sales during its first full year, while Hemgenix sales increased 25%.
What happens next for CSL shares?
CSL expects revenue to remain broadly unchanged in FY27, with underlying net profit forecast to grow approximately 5% in constant currency.
Its Behring division is targeting mid to single digit revenue growth, while Seqirus expects low to single digit growth.
However, Vifor remains a challenge, with revenue expected to decline approximately 25% amid generic competition and other product-related issues.
Brokers are also divided on where CSL shares could go from here.
Morgan Stanley has a $182 price target, while RBC Capital Markets is more optimistic at $213. Citi is more cautious at $160.
CSL's AGM on 27 October will give investors another chance to hear how its recovery plans are progressing.
