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On Wednesday, Morgan Stanley (NYSE:MS) began coverage on CSL Ltd (OTC:CSLLY). (CSL:AU) (OTC: CMXHF), assigning an Overweight rating to the biotechnology company’s shares. The firm has set a price target of AUD313.00 for CSL stock.
The Overweight rating reflects Morgan Stanley’s positive outlook on CSL’s market position in the plasma-derived products sector. Analysts at the firm highlight CSL’s extensive plasma collection network and robust manufacturing capabilities as key competitive advantages. Recent industry data, including figures from CSL and the US Plasma Protein Therapeutics Association (PPTA), indicate a surge in immunoglobulin (Ig) volumes, recovering from previous supply issues caused by the COVID-19 pandemic.
Morgan Stanley’s analysts project a strong demand trajectory for Ig products, which are used to treat primary and secondary immune deficiencies. They anticipate that CSL will experience solid growth in this area, despite potential competition from FcRn receptor agonists in treating chronic inflammatory demyelinating polyneuropathy (CIDP).
Additionally, the firm is optimistic about CSL’s pipeline, particularly Hemgenix and Andembry (garadacimab). Hemgenix has shown sustained factor IX (FIX) levels four years after infusion, a promising sign for long-term efficacy in haemophilia treatment. Andembry, with its favorable dosing profile, stands out compared to existing treatments and those in late-stage development.
Morgan Stanley expects these products to contribute to CSL’s revenue growth in the haemophilia and specialty product segments over the medium to long term. The firm’s revenue growth forecasts for CSL are approximately 7% in the coming years. This includes an estimated 8% growth for the CSL Behring division and around 3% for both the Seqirus and Vifor divisions.
The initiation of coverage with an Overweight rating and a substantial price target suggests that Morgan Stanley sees CSL as well-positioned for future growth, backed by its strong product portfolio and promising pipeline.
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