Finder makes money from featured partners, but editorial opinions are our own.

Why is the CSL share price under pressure?


CSL retracts, after growing 25% in just 6 months.

Biotech giant CSL (ASX: CSL) has long been the most expensive stock on the ASX in terms of absolute price, so it is unusual to see a sharp movement in its shares. But the stock is topping the list of the biggest losers on Tuesday, and was down 3.3% to 296.27 at the time of writing.

Why is the CSL stock price slipping back?

Part of the recent gains in CSL can be attributed to the broader lift in healthcare stocks globally helped by the rapid rollout of the coronavirus vaccines and rising revenue because of the increasing focus on healthcare. In line with other global pharma stocks, CSL shares have lifted around 25% in the last 6 months.

However, the "defensive" healthcare sector is now being caught up in the turmoil of rising bond yields in global markets. US Treasury yields bounced higher overnight, continuing their upward momentum from last week as the Federal Reserve moved closer to easing off its pandemic-era policies.

Basically, investors are betting on rising inflation as economies open up, leading to bond prices falling and yields rising. This lessens the appeal of stocks, particularly those with steady and safe earnings such as healthcare companies.

CSL shares are now down nearly 5% in the last 3 sessions and some of this is on account of investors booking profits after the recent run up that saw the stock hit a high of $312.99 earlier this month.

Focus on margins

But the CSL stock has also been in the spotlight for reasons specific to the company.

Plasma products are the key revenue driver for the biotech business, with its Behring business generating over US$8 billion in revenue in FY21. However, elevated plasma collection costs are expected to weigh on CSL in the near term, which will affect gross margins at CSL Behring.

Analysts believe plasma collection headwinds will continue through FY 2022.

Meanwhile, CSL has seen lower than expected take up of the AstraZeneca COVID-19 vaccine, which it manufactures in the country, after Australia’s top advisory body on immunisation changed its recommendations on its use a number of times.

The company is also stepping up its investment in research and development, in particular to accelerate research into mRNA vaccines, the same technology used in the Pfizer and Moderna COVID jabs, with the intent to manufacture them in Australia.

CSL spent US$1 billion on research and development in 2021 and this number is set to increase, with the business setting a spending target of 10-11% of annual revenue.

Considering buying CSL shares?

If you are keen to buy shares in CSL, you can invest through an online share trading platform.

Keep in mind that not all platforms offer the same list of stocks. Some offer US stocks only, so make sure to select a platform that offers ASX-listed stocks.

Choose from the dozens available for Australian investors. Compare the features and fees from the plethora of trading platforms available.

Looking for a low-cost online broker to invest in the stock market? Compare share trading platforms to start investing in stocks and ETFs.

Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades. Read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for the product on the provider's website.

Get more from Finder

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and 6. Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site