How did the company’s shares react following its H1 FY21 result?
The post How did the CSL (ASX:CSL) share price respond last earnings season? appeared first on The Motley Fool Australia. –
The CSL Limited (ASX: CSL) share price has climbed 8% over the past month, reflecting renewed investor optimism of late. It’s no secret that the company is due to report its much-anticipated FY21 full-year results on Wednesday.
After Monday’s market close, the global biotech’s shares finished the day flat at $297.49. In early trade on Tuesday, their price has dropped 0.29% to $296.64.
Let’s take a peek to see how CSL performed for the first half of FY21 and how its share price reacted.
What did CSL report for H1 FY21?
Here’s a summary of the financial numbers that CSL posted for its last earnings season.
Total revenue up 16.9% to US$5,739 million driven by 9% increase in CSL Behring revenue and a 38% jump in Seqirus revenue
Earnings before interest and tax (EBIT) up 44.4% to US$2,358 million
Net Profit After Tax (NPAT) up 46.2% to US$1,810 million
Following the release, CSL shares rocketed from $279.51 on 17 February to an intraday high of $295.30 on 18 February. This represents a jump of around 5.6% for the blue-chip company.
However, investors were quick to take profit off the table as CSL flagged plasma collection issues in its report. In the weeks after, the company’s shares were trading at a 52-week low of $242.00 apiece.
What should investors look out for this earnings season?
According to Goldman Sachs, CSL is expected to negatively surprise the market tomorrow on its FY21 result. The broker notes that the result is set to be challenging but, in itself, a minor focus amid the COVID-19 chaos.
CSL reaffirmed its earnings to be within 3% to 8% ahead for the FY21 full-year, despite delivering a 25% increase at H1 FY21. This points to an earnings decline of 47% to 58% in the second half.
Cost pressures are also likely to persist into FY22 as CSL aims to recover the collection of plasma to pre-pandemic levels.
In addition, the development of mRNA-based flu vaccines could be a concern for the company’s Seqirus business. The threat of competitive entry into this market will be carefully watched.
CSL share price snapshot
Year-to-date, the CSL share price has continued to move sideways, reflecting a 5% gain for the period. When looking at a longer time frame, the company’s shares are up 6% over the last 12 months.
CSL commands a market capitalisation of roughly $135.4 billion, making it the third largest company on the ASX.
Should you invest $1,000 in CSL right now?
Before you consider CSL, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and CSL wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
*Returns as of August 16th 2021
If you invested $1,000 in CSL (ASX:CSL) shares a decade ago, here’s what it would be worth now
Here’s why the CSL (ASX:CSL) share price is up 5% in a month
How does the CSL (ASX:CSL) share price perform during lockdowns?
5 ASX shares to hold for 5 years
Motley Fool contributor Aaron Teboneras owns shares of CSL Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.