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CSL, CSL LIMITED
nipper
post Posted: Yesterday, 12:11 AM
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CSL does not fit the mould of the typical company in the top 200 which pays out 60 to 70 per cent of earnings in dividends. CSL's dividend yield is about 1.5 per cent and its payout ratio is less than 50 per cent.

"We are not a high divvy stock not because we don't want to pay a high dividend," CEO Paul Perreault says. "We want to reward the shareholders, but we also want to balance that against the capital demands because we're a highly capital-intensive company.

"When you look at the size of our facilities and what we have to do, these are massive biologic manufacturing facilities with a lot of stainless steel and filtrators, lyophilisers, pasteurisers and other big, heavy equipment. "We also want to make sure that the R&D investment and the expansion of the translational medicine through our commercial activities is all being invested in."

- trading at 40x forward earnings



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Dec 7 2019, 10:56 AM
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https://www.sharecafe.com.au/2019/12/02/csl...d-of-foresight/



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
blacksheep
post Posted: Nov 29 2019, 02:26 PM
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In Reply To: nipper's post @ Nov 29 2019, 09:29 AM

Credit Suisse ups CSL price target by 24pc
Luke Housego
QUOTE
Credit Suisse has raised its price target for CSL to $305, up 24 per cent, citing the pricing growth opportunity in Europe for the company's IG segment.

"All plasma participants have noted a tight IG market where demand is currently exceeding supply," the analysis noted.

Retaining its "outperform" rating on the stock, the investment bank's analysts increased its earnings per share estimate by 2 to 3 per cent across the forecast periods to the 2022 financial year.

"While CSL's valuation may be viewed as demanding, trading at 38.4 times 12 month forward price to earnings ratio and at a 90 per cent premium to ASX200 Industrials (ex-financials), in our view, the valuation is justified given CSL's strong market position in a niche industry that has robust fundamentals," the analysts said.


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The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
nipper
post Posted: Nov 29 2019, 09:29 AM
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If it hadn’t been for index heavyweights such as CSL, Macquarie Group, Transurban and Goodman, it would have been near impossible for the ASX 200 to reach for a new all-time high in 2019. Yet, the sad fact remains most investors don’t own shares in CSL, though some may have owned shares at some point throughout those 25 years.

The usual explanations heard are “too expensive” and “cannot get my head around it”. This goes both for the self-managing retail crowd as for professional fund managers. The logical observation to make here is that everybody who bought shares in CSL, no matter when or at what price, is today sitting on a profit.

With the shares trading on a FX-adjusted, forward-looking estimate of about 37 times FY20 earnings per share, it will nearly always be too “expensive” for typical value-seekers, while the implied 1.2 per cent dividend yield is too low for the income-hungry.

Maybe, without owning shares in the company, there are some valuable lessons to be learned from CSL for investors of all kinds and various levels of experience.

In 2019, all three major external factors have ultimately aligned to push CSL shares to a new all-time high. This is not necessarily always the case. When bond yields rise strongly in a short time, as they did in late 2016, CSL stock temporarily faces a formidable headwind.

When the dollar strengthens against foreign currencies, this also tends to create a headache, and similar underperformance follows when investors temporarily favour cheaper-looking, beaten-down cyclicals like they did when the GFC bear market ended in 2009-2010.

Another complicating matter is the fact that CSL is now the number three index component in Australia, which makes the stock more susceptible to general market sentiment. Whereas in the past the shares were at times able to not necessarily follow general market sentiment down, such idiosyncratic behaviour is a lot more difficult when large sell orders aiming to replicate the index hit the local market.

Most importantly, however, is that 25 years from the past show that whatever external factor is holding back the stock at any given point, as long as the business continues to perform, its shares will ultimately perform, too. As such, every period of weakness or stagnation in the share price ultimately proved a profitable entry point.

This takes us to the operational reliability that has become one of the trademark characteristics of CSL. How come most businesses cannot replicate the solidity and sustainability of CSL? Never a profit warning. Seldom an operational disappointment. This company, throughout various managers, has an almost alien-like track record in a sharemarket that regularly shocks through corporate failures and mishaps.

The answer is two-fold.

● First, CSL has managed to transform itself into the highest-quality benchmark for the plasma industry globally. It operates collection centres more efficiently than anyone else, which means it can open additional centres quicker and earn its investments back in a shorter time.

● Second, in line with general industry practice, CSL invests about 10 per cent of annual revenues back into its business to expand through new centres and to constantly develop new products. It has a rich history for discovering and developing new therapies and medical solutions, which is necessary in the fast-moving and ever-evolving biotech-medical world...
FN Arena



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Nov 27 2019, 11:17 AM
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And above $280

....if the banks tank, it could eclipse CBA and be largest ASX biz in terms of M/C !



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
plastic
post Posted: Nov 11 2019, 04:18 PM
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In Reply To: nipper's post @ Nov 11 2019, 04:10 PM

$122bn market cap. Ever wondered why they don't list in the US?



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nipper
post Posted: Nov 11 2019, 04:10 PM
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Closed at day's high, above $270. Out of the blocks at a canter and barely looked back all day.




--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Nov 5 2019, 07:43 AM
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CSL's strategy of building out its plasma collection centres even when there was a period of oversupply was paying off.

"Many of CSL's largest competitors have experienced constraint in terms of supply into this space and CSL is well-placed to grow share," [an analyst] said. "Five, six, seven years ago, people said immunoglobulin would slow down and return to a normalised period. While there was a period of oversupply, CSL stuck to its strategy of rolling out collection centres in the US, investing for growth and securing the volume for themselves.

"When competitors were holding back because they lacked vision for five years down the track, CSL invested … and now we see year after year of demand outstripping supply and the other competitors just don't have enough capacity to keep up with the accelerated demand."

Immunoglobulin therapies are used to treat conditions such as Kawasaki disease, Guillain-Barre syndrome, lupus, chronic inflammatory demyelinating polyneuropathy and immune deficiencies. The diseases range from chronic to life-threatening conditions.

A Credit Suisse note on CSL revealed the growth in demand for immunoglobulin in the three biggest global markets of the US, Australia and Canada was tracking at 9-12 per cent, above the historical norm of 6-8 per cent, due to increased awareness of the diseases it's used to treat, ageing patients and increased dosages. To meet the growing demand, an additional 80-90 plasma collection centres would need to be opened each year between now and 2025.

In July, major US hospital Massachusetts General activated its Incident Command System, usually used for major disasters such as terrorist attacks, to address the immunoglobulin shortage. In a statement about the shortage, the hospital said it had been forced to cancel some patient appointments due to the lack of immunoglobulin and that the shortage could persist into 2020....




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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
blacksheep
post Posted: Nov 1 2019, 12:52 PM
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In Reply To: blacksheep's post @ Oct 16 2019, 08:04 PM

Updated chart - nudging $260. Currently $258.66
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--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
blacksheep
post Posted: Oct 16 2019, 08:04 PM
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In Reply To: plastic's post @ Oct 16 2019, 07:59 PM

A couple of minor "speed bumps" along the way but nothing major biggrin.gif



--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
 


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