CSL Limited

CSL's share price spent much of the last few months going sideways. However, on news that the company is to join forces with the Red Cross to co-develop a revolutionary new bandage product that may be capable of stopping traumatic bleeding, it exploded. The bandage contains two natural clotting agents known as fibrinogen and thrombin. This is a huge positive for CSL, but the product is unlikely to hit the market until at least 2003 and won't be doing much for earnings between now and then. Such an overreaction on the part of investors is an indication of the market's current mentality and we would not be surprised to see the share price retrace much of the ground covered during recent weeks. Nevertheless, despite this overreaction we remain very comfortable with the company's prospects and its location in one of the industries of the future. At the time of our last main review in issue 26 at $12.70, we recommended the stock could be accumulated but have now changed it to HOLD as a result of the increase.