As Australia remains locked down, how can we expect the ASX biotech share to perform?
The post How does the CSL (ASX:CSL) share price perform during lockdowns? appeared first on The Motley Fool Australia. –
The CSL Limited (ASX: CSL) share price edged 0.36% lower to close at $296.87 on Monday. Shares in the Aussie biotech have managed to climb higher so far in 2021 but have still underperformed the S&P/ASX 200 Index (ASX: XJO) thus far.
With vast swathes of Australia currently subject to tight COVID-19 restrictions, let’s see how one of Australia’s largest companies has changed in value throughout previous lockdowns.
What happens to the CSL share price during lockdowns?
Let’s wind the clock back to February 2020. As COVID-19 spread across the world, most Aussie shares were in freefall in the March bear market. CSL was not immune from the downturn and fell 19.5% from 20 February to 20 March.
The CSL share price largely recovered and hit $329.00 per share by April 2020. Since then, however, share price growth has been subdued.
Let’s consider recent lockdowns and how the ASX biotech share has performed in those times. For instance, Melbourne was subject to strict lockdown orders from August to October 2020.
The ASX biotech share did manage to climb 6.5% from the start of August to the end of October. It’s easy to think then that the CSL share price performs strongly during lockdowns.
However, this period also coincided with CSL announcing a vaccine partnership with the University of Queensland. While lockdowns can be extensive, there can also be many company-specific or macro events that impact share prices during those times.
Sydney’s Northern Beaches outbreak started just before Christmas last year. The CSL share price fell 4.8% lower throughout the month of December to close the year at $283.18.
Once again, however, the scrapping of the CSL/University of Queensland vaccine candidate occurred on 12 December and may have had a large impact on the share price.
What about the current Sydney outbreak?
While there have been shorter lockdowns in Perth, Adelaide and Melbourne in the intervening months, let’s take a look at the current outbreak in Sydney. The first case in the current outbreak was recorded on 16 June with lockdown restrictions from 24 June.
The CSL share price fell 9.8% from 21 June to 15 July. However, the ASX biotech share is up 7.9% since then to its current $296.87 per share level.
For many companies, it’s hard to find direct correlations between share price movements and lockdown restrictions. That’s particularly the case for a company as large and varied as CSL, which also has a stake in the COVID-19 effort through its AstraZeneca production contract.
The CSL share price growth has been subdued in 2021. Shares in the Aussie biotech are up 4.16% year to date and 6.21% in the last 12 months. Investors will be watching closely to see where they are headed amid the current eastern seaboard lockdowns.
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 May 24th 2021
If you invested $1000 in CSL (ASX:CSL) shares a decade ago, this is how much they would be worth now
How owning too much Afterpay (ASX:APT) was our biggest regret
It hasn’t been a great 2021 so far for the CSL (ASX:CSL) share price
Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. 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.