This morning marked a historic occasion for Aussie biotech giant CSL [ASX:CSL]. Commonwealth Serum Laboratories saw their share price pass the $100 mark. At the time of publication, it’s trading at $100.64.
Source: Google Finance
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This represents a record high for the vaccine and blood products producer. The last time it hit this high was in 2007, before it split in order to improve liquidity and make CSL more affordable for retail investors. It is not yet known whether the company plans to do the same thing again.
This boost may have had something to do with CSL’s latest acquisition. Last Friday, they announced that they had secured all the regulatory approvals needed to buy the flu vaccine business of Novartis [VTX:NOVN]. They paid US$275 million ($377.5 million) for it. Yesterday, they announced that they have paid the money and closed the transaction.
CSL will integrate the flu vaccines division with its subsidiary, bioCSL. Once combined, it will be the second biggest influenza vaccine business in the world. The new entity will have an impressive share of the US$4 billion ($5.5 billion) global market. CSL is planning to call it Seqirus, derived from ‘securing health for all of us’. They’ll start using the new name in October.
Seqirus will have manufacturing plants in the UK (with a head office in Maidenhead near London), Germany, Australia, and the US. This will allow it to supply the flu vaccine to about 20 different countries.
CSL CEO Paul Perreault explained that Friday’s regulatory clearance would pave the way for CSL/Seqirus to take advantage of upcoming flu vaccine sale seasons. ‘This is a significant acquisition for CSL as a leading global biotherapeutics company which has long been at the forefront of protecting people’s health. We are pleased to clear the necessary hurdles and work towards an earlier close [and] deliver on our combined seasonal sales opportunities in major markets,’ said Perreault on Friday.
In general, it’s great news for existing shareholders. But as in 2007, many investors still feel priced out of CSL. The good news is, there are plenty of great opportunities to gain some exposure to the health care industry. You just have to dig a little deeper than established large-caps like CSL.
The answer is small-caps.
In ‘The At-Home Investors’ Guide to Profiting from Australian Small-Caps’ — available here for free — analyst Sam Volkering explains how to find and assess the best small-cap stocks. Before the big institutional investors get to them. This report is full of expert insight and practical tips on how to research, buy and sell small-cap stocks successfully. One of the examples he uses is a small-cap diagnostics provider that’s gained just over 40% in the last year.
If you’ve owned CSL for a few years, you’re probably feeling pretty good right now. If you’re still looking for that golden opportunity in health care, don’t forget to find out how to download your complimentary copy of Sam’s report.
Eva Mellors,
Contributor, Money Morning
The post Why CSL Has Passed the $100 Mark — Again appeared first on Stock Market News, Finance and Investments | Money Morning Australia.