CSL share price in focus
CSL is a global biotechnology company that creates and delivers life-saving medicines, aiming to protect public health and improve the quality of life for those with life-threatening conditions.
The company operates through three main divisions: CSL Behring, CSL Seqirus, and CSL Vifor. Behring, acquired in 2004, focuses on manufacturing and distributing blood plasma products. Seqirus, formed from the rebranding of BioCSL and the acquisition of Novartis’ flu business in 2015, develops flu-related products and provides pandemic-related services to governments. Vifor specializes in products for iron deficiency and nephrology (renal/kidney care).
CSL has built a strong reputation among Australian investors for its reliability and consistent dividend payouts, making it a popular choice for those seeking exposure to the growing healthcare sector. Many view CSL as an indirect investment in the rising global demand for healthcare.
PME shares
Founded in 1983, Pro Medicus is a provider of radiology IT software serving hospitals, imaging centres and healthcare groups worldwide.
The company’s suite of products focuses on Radiology Information Systems (RIS), Picture Archiving and Communication Systems (PACS), and advanced visualization solutions. These tools support various functions, from patient scheduling and billing to rapid medical imaging interpretation and analysis.
Pro Medicus’ key value proposition lies in its flagship Visage software, which enables radiologists to remotely view large image files generated by X-rays on mobile devices. This capability allows diagnostic decisions to be made on-the-go, potentially improving patient outcomes by providing timely and accessible information.
CSL & PME share price valuation
We would consider CSL to be a ‘mature’ or ‘blue-chip’ business, so some of the metrics that could be worth considering include the debt/equity ratio, average yield, and return on equity, or ROE. These measures give us a sense of the company’s debt levels, their ability to generate returns from their assets, and their ability to consistently return profits to shareholders.
For FY24, CSL Ltd reported a debt/equity ratio of 62.8%, meaning the company has more equity than debt.
Over the last 5 years, CSL has delivered an average dividend yield of 1.5% per year. This is important to note if you’re looking for income from your investments.
Finally, in FY24, CSL reported an ROE of 14.6%. For a mature business you generally want to see an ROE of more than 10%, so CSL clears this hurdle.
As more of a growth company, some of the trends we might consider for PME shares include revenue growth, profit growth, and return on equity (ROE). I say ‘trends’ because it’s always important to look at these figures over a few years. The trend is a much more valuable figure than a single measure at one point in time.
Over the last 3 years, PME has increased revenue at a rate of 33.4% per year to hit $162m in FY24. Meanwhile, net profit has increased from $31m to $83m. As for ROE, PME’s last reported figure was 50.7%.
Please keep in mind that context is important. These metrics give us some indication of company performance, but it’s just the start of valuing CSL or PME shares. To learn more about valuation, check out one of our free online investing courses.
