These 2 blue chip ASX shares are rated as buys by brokers. One of those choices is healthcare giant CSL Limited (ASX:CSL).
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Some blue chip ASX shares out there are rated as buys by brokers.
It can sometimes be worth taking into account what brokers think because they are constantly looking at which shares look good value and what investments could make money. They have access to research and tools that many retail investors don’t.
Here are two blue chip ASX shares:
Macquarie Group Ltd (ASX: MQG)
Macquarie is one of the biggest businesses on the ASX with a market capitalisation of $48.7 billion, according to the ASX.
The investment bank is currently liked by two brokers, including Morgan Stanley. The broker thinks that the FY21 third quarter profit will be roughly in line with last year’s figures. However, an improving economic environment could see Macquarie match or even exceed the market’s expectations for the FY21 result.
In early November the business reported its FY21 half year result, which included a lot of COVID-19 pain. It said that net profit was down 32% compared to the prior corresponding period, with credit and impairment charges of $447 million, up from $139 million, primarily related to a deterioration in the current and expected economic conditions.
At 30 September 2020, the blue chip ASX share had $556.3 billion of assets under management (AUM), which was down 7% from 31 March 2020.
Macquarie recently announced the acquisition of Waddell & Reed Financial, a US-based asset and wealth manager for US$1.7 billion. Macquarie plans to divest one segment of Waddell & Reed and keep the asset management business which had US$68 billion of AUM.
The blue chip ASX share said that increased scale and diversification of the combined platform will create significant long-term benefits for clients, advisors and shareholders.
According to Commsec, the Macquarie share price is valued at 16x FY23’s estimated earnings.
CSL Limited (ASX: CSL)
CSL is one of the biggest biotech businesses in the world with a market capitalisation of just over $125 billion, according to the ASX.
The blue chip ASX share is currently liked by at least three brokers.
Brokers like the portfolio of assets and products that CSL has, giving it growth options such as the cardiovascular opportunity.
However, there have been problems with plasma collection due to the COVID-19 pandemic. CSL said it’s being restrained and there are higher costs for collection, but it does have multiple initiatives underway to mitigate the impact.
We’ll soon hear the FY21 half-year result from the healthcare giant. But the company did give an update at its annual general meeting (AGM).
CSL is expecting strong demand for its plasma and recombinant therapies to continue. In Seqirus, it’s expected to continue to benefit from its differentiated products and strong demand for influenza vaccines, driven in part by governments wanting to protect their populations from contracting two viruses.
The blue chip ASX share also said that sales of albumin are expected to normalise after the successful transition to the new business model in China.
In terms of research and development, CSL said that its response to COVID-19 as well as new initiatives will put upward pressure on the research and development expense, but this is still within 10% to 11% of the revenue guidance.
FY21 revenue is expected to grow by between 6% to 10%, whilst net profit after tax (NPAT) is expected to grow by 3% to 8% to US$2.17 billion to US$2.265 billion.
According to Commsec, the CSL share price is valued at 34x FY23’s estimated earnings.
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Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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