CSL - CSL Limited

[Superb Parrot]

It will, with its US earnings, also benefit from the predicted drop in the Aussie dollar as US interest rates pick up, suggested to be sometime in 2015.

Interesting, as Bill Gates requested CSL (among others I imagine)to investigate Tx for Ebola. The lift may be short term http://hfgapps.hubb.com/asxtools/Charts.aspx?asxCode=CSL&chartType=3&volumeInd=9&TimeFrame=D6

 

[financialreports]

The price of CSL has risen substantially over the last few months as the company continued it's cash injections in the form of share buybacks.

At these price levels, CSL may wish to reduce their buyback program and increase their investment in research, development and acquisitions.

 

[leyy]

Any thoughts on CSL?

Bought a parcel of shares in CSL.

Strong uptrend 5 year chart.

Very strong fundamentals.

circa 70% income in USD, with a low AUD/USD this should come out nicely.

Interim report out on 11 Feb 2015, should show some positive results.

 

[Triathlete]

Any thoughts on CSL?

Bought a parcel of shares in CSL.

Strong uptrend 5 year chart.

Very strong fundamentals.

circa 70% income in USD, with a low AUD/USD this should come out nicely.

Interim report out on 11 Feb 2015, should show some positive results.

My technical view is that I expect to see a pullback from these levels as their is a strong resistance level at the $90 area. If we get this than I would feel more confident of the stock continuing higher from here. I have attached my own Monthly analysis chart on the stock.

 

[PinguPingu]

Glug glu glug, CHF having an impact!

 

[McCoy Pauley]

Been too busy with my day job to pore through CSL's numbers, but it seems like the fact that CSL reduced guidance for its full year NPAT growth from 12% down to 10%, as well as a set of figures in the first half that didn't shoot the lights out has contributed to the share price tumbling today.

 

[Value Collector]

Been too busy with my day job to pore through CSL's numbers, but it seems like the fact that CSL reduced guidance for its full year NPAT growth from 12% down to 10%, as well as a set of figures in the first half that didn't shoot the lights out has contributed to the share price tumbling today.

They trade on a very high Pe, so I guess any sign of weakness (not that it was that weak), can see some of the froth blown off.

I don't hold Csl, but I think it's a great company, if the share price did drop back a bit, I would happily take a position,

 

[Knobby22]

Going back up today.
My largest shareholding. I predict it will be over $100 a share within a year.
It really is the only decent growth company in the top twenty.

 

[Value Collector]

Going back up today.
My largest shareholding. I predict it will be over $100 a share within a year.
It really is the only decent growth company in the top twenty.

No doubt that if they continue their buy back at the current rate it will eventually get there, whether that's this year or not who knows.

What sort of earnings multiple do you personally think is fair for this company? I would be happy to pay a more than average simply because of their position in the industry and recession proof businesses, but $100 on current earnings seems fairly frothy, just wondering how you personally value it.

 

[Julia]

Going back up today.
My largest shareholding. I predict it will be over $100 a share within a year.
It really is the only decent growth company in the top twenty.

What about MQG? They seem to be back on track to repeat their performance pre GFC

 

[Knobby22]

What about MQG? They seem to be back on track to repeat their performance pre GFC

Well maybe. But it is more a company based on world wealth which deems to be stalling at the moment and you can't compare the track record (or the amount management takes from shareholders).

CSL is now number two in blood products, number 3 (after the latest takeover) in Flu serums, is not tied to the Aussie market which is important in this market. It has even greater blue sky in the experimental works it undertakes ( a huge percentage of the profits goes to research). In capitalisation it has passed many major companies, Woolworths is the next one in line.

A sign of a good company is one that many say is overpriced but then regrets they didn't buy. instead they but a cheap company and wonder why returns are poor long term.

When valuing you need to take into account the continuing fall of the $A so you should add a 20% premium. You should in my view calculate the growth at about 15% a year though the CEO has temporarily lowered it at present to keep market share. The other downer is the plant in Bern which has been hit by the appreciating currency. So maybe the price is about right at the moment but if it drops to below $80 it is a definite buy.

 

[Knobby22]

Just like to point out CSL is now above $90. The very short dip was a buying opportunity.

 

[Superb Parrot]

Just like to point out CSL is now above $90. The very short dip was a buying opportunity.

They already have had a three for one split. Wonder if another is in the wings as $100ish may be off-putting for some.

 

[Knobby22]

They already have had a three for one split. Wonder if another is in the wings as $100ish may be off-putting for some.

I'd be all for it. Logically it doesn't make a difference but human psychology is not that logical.

 

[Knobby22]

Over $100! As expected.

 

[skc]

Over $100! As expected.

Found a good summary on CSL by UBS.

At the stock level, CSL is a prime example of this willingness to pay massive premiums for traditional growth stocks, whether they deliver the growth or not. At the full-year result this week, CSL achieved their guidance of about $1,470m and just 5% growth by excluding the losses from their flu business. This number also includes a foreign exchange gain of about $115m. The normalized number is over 25% lower than where expectations were one year ago. This performance is clearly not the kind of quality growth expected from a company trading on over 30 times.

The company then guided to 11% growth for 2017. However, the starting point for this growth includes the flu loss and excludes the foreign exchange gains for a base of just $1,152m and a 2017 earnings target of $1,278m. Therefore to report a number showing some growth, various one-offs were included, but to ensure growth for the following year these same one-offs were removed from the base. That is the company is asking the market to accept $1,470m as the measure of the performance in 2016, and $1,278m (-13% lower) as the target in 2017, and arguing this still represents growth. In fact, earnings have grown by less than 2% p.a. since 2010. It would be understandable for the market to have hammered the stock over this period. Instead, CSL has been consistently re-rated from an average in the high teens before 2013 to about 30 times now. CSL is one example of many of this trend.

https://www.livewiremarkets.com/wires/32800

 

[tinhat]

At the stock level, CSL is a prime example of this willingness to pay massive premiums for traditional growth stocks, whether they deliver the growth or not.

I would add that CSL is also an example of willingness to pay massive premium for defensive stocks, which is what these sort of "blue-chip" health industry stocks are perceived to represent (resilient to economic cycle).

I sold out at $36 because I couldn't see the share price going anywhere. Since then (2012) EPS has risen >40% but the price has tripled.

 

[Knobby22]

Now Paul McNamee has retired we have a standard CEO.

Didn't take long for him to put his hand in the cookie jar.

•CSL chairman John Shine and chief executive Paul Perreault argued their case for more generous executive pay after shareholders made a protest vote against the company’s remuneration model. More than one in four shareholders voted against the company’s move from an Australian model to an international model of executive pay, which could see the chief executive earn up to $14.1m. Shine said the executive pay model was appropriate seeing as though the company operates in 30 countries, and 90% of profits are sourced outside the country.

 

[Value Collector]

I found this video on the companies history, thought I would share it.

 

[Value Collector]

They trade on a very high Pe, so I guess any sign of weakness (not that it was that weak), can see some of the froth blown off.

I don't hold Csl, but I think it's a great company, if the share price did drop back a bit, I would happily take a position,

Over $100! As expected.

Back down to circa $100, I have taken a position at $80 by selling a put, I would be happy to own at that level.

It's a weird one to value, it definitely has a solid position and deserves a highish PE, but with the Buyback operating at levels being funded by debt it's hard to know how beneficial this will ultimately be, but I am comfortable with $80, I will probably just keep an out of the money put option position rolling until I can some stock via it being exercised, until then I can earn more in put premiums than I can by the CSL dividend.