Take Profits On CSL, But Don’t Say Goodbye

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By Rudi Filapek-Vandyck

It’s a happy bunch at ABN Amro Warrants which advises its clientele today it may be time to start locking in some profits in healthcare stock CSL (CSL).

ABN Amro Warrants recommended investors buy into the stock on January 15 when the shares were trading at around $66. The target set at the time was $72. The shares closed at $71.70 yesterday, hence the advice to take some profits.

However, taking profits is not waving goodbye in this case with the team arguing investors should buy back into any dips ahead of the profit result release on February 21. ABN Amro Warrants believes the company may well surprise the market with more positive news.

The broker is currently looking for a net profit of $208m and a dividend of 35cps. ABN Amro currently has a twelve month price target of $73.50. The fundamental analyst downgraded the stock to Hold last week.

The Warrants team believes the large number of R&D projects in the company’s pipeline through 2007 and 2008 will provide potential catalysts for re-ratings, including earnings estimates upgrades, the years ahead.

CSL is currently rated four times Buy and five times Hold as a result of recommendation downgrades last week by ABN Amro and Credit Suisse. The average price target is $74.32.

CSL shares were trading 77c higher at $72.47 at around 11.30am.

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