CSL - CSL Limited

[Gundini]

I grabed $30.28.

Did go down under $30 but held.

I am out of here under $30 on this one.

Nice mover, happy to trade with a long term view!

 

[bleach8]

CSL , share dropped 4% and with a reasonable increasing in volume. Is this mean it will have another few big drops before recover?

 

[michael_selway]

CSL , share dropped 4% and with a reasonable increasing in volume. Is this mean it will have another few big drops before recover?

Yeah interesting this one

Earnings and Dividends Forecast (cents per share)
2008 2009 2010 2011
EPS 126.8 175.6 218.4 258.9
DPS 46.0 61.0 77.0 92.3


thx

MS

 

[Econinvestor]

It is puzzling why CSL would fall. It has little debt and lots of guaranteed revenue. But then again, it was way lower than it was worth a few months ago (around 29) and went up to 38. I made nearly 30%

CSL's products are pretty much recession-proof: recessions don't stop people getting sick. On top of this, its costs are lower, due to the word-wide downturn. Since it averaged around 37 over October and the first half of November last year (before investors started panicking) it should return to this level again. Nothing has changed to affect its fundamentals that I'm aware of.

I don't think the recent AUD strength is a problem either. CSL was above 35 when AUD was between 95 and 85 cents last year...

I'm buying more in any case.

 

[Aussiest]

It is my understanding that people turn to biotechs in times of economic downturn, when other stocks go down?

If the market makes a partial recovery, i wonder whether biotech stocks will hold their value

I am skeptical on this one, but each to their own

 

[Junior]

My theory is that there has been more of an appetite for risk recently. Hence defensives such as Healthcare have fallen out of favour, funds have moved into financials and miners instead.

 

[Knobby22]

My theory is that there has been more of an appetite for risk recently. Hence defensives such as Healthcare have fallen out of favour, funds have moved into financials and miners instead.

Pretty true. It's also that though CSL is cheap there are some amazing bargains out there, if the economy improves. CSL will rise in the second wave if the recession is indeed over. I don't think it is yet unfortunately.

 

[Econinvestor]

My theory is that there has been more of an appetite for risk recently. Hence defensives such as Healthcare have fallen out of favour, funds have moved into financials and miners instead.

That's possible, but the returns on other stocks would have to be huge. For a start, if what you say is true about defensive stocks and if there is another big drop, then CSL will go up quickly. Moreover, if there is a shortage of capital and CSL went down as people shifted into better returning shares, then it is due to go up when other investors enter the market.

Pretty true. It's also that though CSL is cheap there are some amazing bargains out there, if the economy improves. CSL will rise in the second wave if the recession is indeed over. I don't think it is yet unfortunately.

Basically it is a win-win stock to own at this price. Insurance on the downside, and 20% on the upside! What other stock gives you that??

 

[Julia]

It is puzzling why CSL would fall. It has little debt and lots of guaranteed revenue. But then again, it was way lower than it was worth a few months ago (around 29) and went up to 38. I made nearly 30%

CSL's products are pretty much recession-proof: recessions don't stop people getting sick. On top of this, its costs are lower, due to the word-wide downturn. Since it averaged around 37 over October and the first half of November last year (before investors started panicking) it should return to this level again. Nothing has changed to affect its fundamentals that I'm aware of.

I don't think the recent AUD strength is a problem either. CSL was above 35 when AUD was between 95 and 85 cents last year...

I'm buying more in any case.

That's possible, but the returns on other stocks would have to be huge. For a start, if what you say is true about defensive stocks and if there is another big drop, then CSL will go up quickly.

On what basis are you suggesting this? We have had more than one big drop and CSL hasn't gone up. It has been trading sideways with effectively no real increase in SP for the last 18 months.

Moreover, if there is a shortage of capital and CSL went down as people shifted into better returning shares, then it is due to go up when other investors enter the market.

Why? As above it hasn't done this previously.

Ecoinvestor, your posts appear to be pretty close to pure ramping imo.

With a SP which is not going up, and a paltry 1.7% dividend, I don't know why anyone would buy this, frankly. Yes, I know it's considered by analysts to be a good 'core fundamental stock' but if we have the view that we buy stocks to make money from them, I find it hard to see why you'd buy something which has not experienced any sign of an uptrend for a long time.

Basically it is a win-win stock to own at this price. Insurance on the downside, and 20% on the upside! What other stock gives you that??

More ramping. You have offered no justification for your suggestions.
What 'insurance' is there on the downside? Is CSL somehow protected from the possibility of bad news? '20% on the upside'????? Really? Where do you get this figure?

 

[Aussiest]

Basically it is a win-win stock to own at this price. Insurance on the downside, and 20% on the upside! What other stock gives you that??

CSL paid $0.43 in dividends last year, and only half of that div was 100% fully franked.

How could that be good value?

CBA paid $2.66 per share in divs last year at an average of around $40.00.

 

[Econinvestor]

On what basis are you suggesting this? We have had more than one big drop and CSL hasn't gone up. It has been trading sideways with effectively no real increase in SP for the last 18 months.


Why? As above it hasn't done this previously.

Ecoinvestor, your posts appear to be pretty close to pure ramping imo.

With a SP which is not going up, and a paltry 1.7% dividend, I don't know why anyone would buy this, frankly. Yes, I know it's considered by analysts to be a good 'core fundamental stock' but if we have the view that we buy stocks to make money from them, I find it hard to see why you'd buy something which has not experienced any sign of an uptrend for a long time.




More ramping. You have offered no justification for your suggestions.
What 'insurance' is there on the downside? Is CSL somehow protected from the possibility of bad news? '20% on the upside'????? Really? Where do you get this figure?

Tsk, Tsk Tsk! You are W R O N G once more. :headshake

December 11th 08, it was $28.11. Feb 26th 09 it was $38.26. You should check your facts before posting flaming rants, Julia.

I bought at 29, sold at 37. Hmmm, lets see, that's about 30%. I think I'd classify making 30% return in a bit over two months as making money. That's an annual rate of 180%. Or is that not enough for you??

Sour, sour grapes Julia. You were so wrong on CBA now you resort to attack, but don't even bother to check your facts. I'm pretty close to asking the moderator to remove your raving posts. This one is, silly, emotive and plain factually wrong.

I don't see the point in people posting comments like your's above. It is ad hominem nonsense. How about using some reason and logic instead of attacking people's motives?

 

[carmen]

CSL paid $0.43 in dividends last year, and only half of that div was 100% fully franked.

How could that be good value?

CBA paid $2.66 per share in divs last year at an average of around $40.00.

CSL = 5 years ago, $10,000 would get you 2,000 roughly shares, now @ $31.5, worth $63,000 (500%+ return) or 100% p/a.

CBA = 5 years ago, $10,000 would get you roughly 333 shares, now @ $36 worth $12,000, 20% return, or 4% p/a.

CSL has been one of the best performing shares on ASX over past decade. The premium low yeild is well tolerated because ppl expect growth in earnings will continue. Outlook on banks not as positive given GFC. Both are good stocks to hold for different reasons imo.

Apologies for the crappy looking chart

 

[bleach8]

the reason for the price deline is due to CSL's major share holder selling its holding from about 11% now about 4.8%. FLC stopped selling in Jan which resulted CSL price increased from 30 to 38. Recently, it started to reduce its holding again. Well, if FLC keep selling at the current speed, its 4.6% holding will disappear in about 2.5 months.
Can someone analyses their short term view on CSL? the price has been around 31-32 for more than a week now ...where will it heading? up or down ?

 

[Julia]

:headshake

December 11th 08, it was $28.11. Feb 26th 09 it was $38.26. You should check your facts before posting flaming rants, Julia.

Maybe reread my post. I quoted the last eighteen months Of course it's gone up and down during that time. But it has been trading below the MA for most of this time.
See attached screenshot which demonstrates my point.

I bought at 29, sold at 37. Hmmm, lets see, that's about 30%. I think I'd classify making 30% return in a bit over two months as making money. That's an annual rate of 180%. Or is that not enough for you??

Oh dear. You cannot annualise a two month return with any sense of realism, surely! That's just picking out the bits you like? Show me where the stock has at any stage in the last eighteen months shown an annual 180% increase. Remember, my comment related to this last 18 months.

I'm pretty close to asking the moderator to remove your raving posts. This one is, silly, emotive and plain factually wrong.

Please do refer the matter to a moderator. I am very happy to accept the judgement of any moderator.

I don't see the point in people posting comments like your's above. It is ad hominem nonsense. How about using some reason and logic instead of attacking people's motives?

I have stated simple fact. This was in response to your post which had all the qualities of a ramp.
Still waiting for your explanation of the 20% upside for this stock.

 

[Econinvestor]

Maybe reread my post. I quoted the last eighteen months Of course it's gone up and down during that time. But it has been trading below the MA for most of this time.
See attached screenshot which demonstrates my point.


I have stated simple fact. This was in response to your post which had all the qualities of a ramp.
Still waiting for your explanation of the 20% upside for this stock.

Simple easy maths. It was trading at 37 or so in a stable market last year. It went down to 30 or so recently for no fundamental reason. Here is the calculation:

37 MINUS 30.3 equals 6.7.

6.7 DIVIDED by 30.3 is over 20%.


Also, of course it goes up and down. That's great for making money. When the fundamentals haven't changed, buy when its low sell when it gets back to the fundamentals. This is all I am saying.

I hope you will confine your comments to analysis rather than motives which you know nothing about. Your accusation is offensive and against the rules of this forum, I believe.

 

[waz]

I have been following CSL daily along with movements in the ASX200 and health indexes from overseas for over a month. What I have noticed is that the biggest influence has been movements in the Au dollar. Even on a intraday basis you can notice it.

If I had the time I would negative correlate the two together with a nice chart.

What I figure, is that if this stock is so correlated to moves in the Au dollar, wouldnt the brilliant management hedge against this??? I would think yes.

Also, CSL can lock in prices for its products whenever it wants to at a time when it is convenient to itself and to maximise profit. Its not like CSL is affected by US dollar denominated spot prices.

The MA chart below is nice, however that statistic doesn't take into account the stock split. Over time the MA line will continue drifting lower, eventually it will trade higher than this line even if it stays steady.

 

[nomore4s]

Simple easy maths. It was trading at 37 or so in a stable market last year. It went down to 30 or so recently for no fundamental reason. Here is the calculation:

37 MINUS 30.3 equals 6.7.

6.7 DIVIDED by 30.3 is over 20%.


Also, of course it goes up and down. That's great for making money. When the fundamentals haven't changed, buy when its low sell when it gets back to the fundamentals. This is all I am saying.

lol, you have got to be kidding me.

Your valuation is based on nothing more than it was trading at $37 in a "stable market". That has got to be the weakest analysis I've ever seen to establish fair value.

You're naive if you think the fundamentals of any stock haven't changed since we had a "stable market"

What are these fundamentals you keep banging on about? All your posts you rave on about fundamentals but I'm yet to see you post any valid fundamental research.

 

[bleach8]

the reason for the price deline is due to CSL's major share holder selling its holding from about 11% now about 4.8%. FLC stopped selling in Jan which resulted CSL price increased from 30 to 38. Recently, it started to reduce its holding again. Well, if FLC keep selling at the current speed, its 4.6% holding will disappear in about 2.5 months.
Can someone analyses their short term view on CSL? the price has been around 31-32 for more than a week now ...where will it heading? up or down ?

the reason for the price deline is due to CSL's major share holder selling its holding from about 11% now about 4.8%. FLC stopped selling in Jan which resulted CSL price increased from 30 to 38. Recently, it started to reduce its holding again. Well, if FLC keep selling at the current speed, its 4.6% holding will disappear in about 2.5 months.
Can someone analyses their short term view on CSL? the price has been around 31-32 for more than a week now ...where will it heading? up or down ?
any comment on this!? pls plsplsplsplslpslpslpslpslsplspslpsl

 

[Julia]

lol, you have got to be kidding me.

Your valuation is based on nothing more than it was trading at $37 in a "stable market". That has got to be the weakest analysis I've ever seen to establish fair value.

You're naive if you think the fundamentals of any stock haven't changed since we had a "stable market"

What are these fundamentals you keep banging on about? All your posts you rave on about fundamentals but I'm yet to see you post any valid fundamental research.

Thank you, nomore4s, for saving me the trouble of pointing out what you have here.
Probably unproductive to engage in discussion with Ecoinvestor.

 

[Econinvestor]

lol, you have got to be kidding me.

Your valuation is based on nothing more than it was trading at $37 in a "stable market". That has got to be the weakest analysis I've ever seen to establish fair value.

You're naive if you think the fundamentals of any stock haven't changed since we had a "stable market"

What are these fundamentals you keep banging on about? All your posts you rave on about fundamentals but I'm yet to see you post any valid fundamental research.

Go back and look at the share price last year, before the crash and panic. Its share price was trading at around the level 37 for many months. That is what I mean by stable. The simple idea you are failing to grasp is that of a market having a long period in which the participants can judge the company, thus establishing a benchmark value. Now, since

1. Demand for their product is, if anything, higher in a recession
2. Input costs have fallen
3. They have low debt
4. They have fixed contracts for supply.


This means that nothing in the market has changed *for that company in particular*. Ergo, it will go back to around 37, unless there is a company specific shock such as class action lawsuits, etc.

In any case, I've done well on CSL, CBA and CTX based on exactly this reasoning and am sharing my opinion on CSL in this forum. If you don't agree with the analysis, that's fine, its your money.