CSL
Recommendation
CSL recently announced its biotherapies division has been awarded a contract to supply the US government with pre-pandemic and pandemic influenza vaccines. This contract could be worth US$1.5bn if the US takes up its full allocation. This is yet another piece of positive news following on from CSL’s stellar full year results released in August (see CSL: Result 2012 from 23 Aug 12 (Hold – $42.08)).
This company is one of the few businesses that can grow earnings regardless of the economic environment and shareholders shouldn’t consider selling unless they’re offered a very rich price. And with CSL’s share price nearing our ‘Take Part Profits’ price of $45 per share we are increasing our recommendation guide prices to reflect the progress made over the past year, the continued growth opportunities for the business and its extremely high underlying quality. However, if you purchased a significant stake in CSL at much lower prices and it now makes up a large proportion of your portfolio you may consider trimming your holding to within the portfolio limit. The share price has increased 7% since 23 Aug 12 and we’re happy to HOLD.
Note: The Growth portfolio owns shares in CSL.