ASX healthcare sector soars on big players
The ASX healthcare sector has seen a significant surge, with a 9.98% increase this week, outperforming the broader market which fell 0.22%. This growth is largely attributed to the positive full-year results from some of the sector’s biggest names, including CSL, which saw a 17.25% surge after releasing its full-year results.
Morgans’ Scott Power, a healthcare and life sciences expert, noted that it has been one of the best starts to the full-year reporting season in a long time. The sector’s performance was also lifted by medical imaging software provider Pro Medicus and hearing implants company Cochlear, which saw increases of 11.88% and 7.58%, respectively.
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CSL’s results showed signs of redemption, with revenue of US$15.8 billion, up 3% on guidance, and underlying NPATA of US$3.1 billion. The company expects its core Behring plasma business to return to mid-single-digit revenue growth in FY27. However, China-focused albumin sales fell 17% to US$1.1 billion, attributed to Beijing’s “cost containment” in that market.
Haemophilia product Hemgenix was up 25%, while its hereditary angioedema product Andembry had sales of US$250 million in its first full year on market. CSL’s flu vaccines arm Seqirus posted revenue of US$2 billion, down 8%, as the prior year’s total was boosted by one-off avian influenza outbreak sales that didn’t repeat.
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Pro Medicus posted its FY26 results, which Morgans healthcare analyst Iain Wilkie described as a “margin masterclass”. The company’s EBIT margin was 74.9%, and constant currency EBIT growth was 30.6%, beating expectations comfortably. Wilkie noted that foreign exchange “did the damage to reported growth, not the business”.
Revenue and EBIT would have been $273.5 million and $206 million, respectively, at flat exchange rates, both growing 28-31% and in line with or ahead of the H1 pace. Momentum remains broad-based, implementations are ahead of schedule, renewals are a clean sweep, and the pipeline is opening in new segments rather than just deepening in existing ones.
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CSL bleeding stops as Morgans lifts target Tuesday’s results showed signs of redemption for CSL, which before the results was down ~70% from its peak of $342.75 in February 2020. A series of restructures, downgrades and impairments has played on investor confidence. CSL posted revenue of US$15.8 billion, up 3% on guidance and underlying NPATA of US$3.1bn. The company expects its core Behring plasma business to return to mid-single-digit revenue growth in FY27. China-focused albumin sales fell 17% to US$1.1bn, attributed to Beijing’s “cost containment” in that market. Haemophilia product Hemgenix, was up 25%, while its hereditary angioedema product Andembry had sales of US$250 million in its first full year on market. CSL’s flu vaccines arm Seqirus posted revenue of US$2bn, down 8%, as the prior year’s total was boosted by one-off avian influenza outbreak sales that didn’t repeat. However, global seasonal influenza sales were up 4% despite falling US immunisation rates, as changes to federal vaccine guidance and messaging under the Trump administration weigh on uptake. Revenue rose 3% to US$2.4bn for kidney and iron division, but CSL flagged a materially weaker FY27 forecasting a roughly 25% revenue decline as generic iron competition intensifies, changes in reimbursement take effect and patent protection run out. “While FY26 was another difficult year, we view the latest result as providing greater confidence that the repeated earnings downgrades are coming to an end,” Morgans healthcare analyst Derek Jellinek wrote in a research note. Morgans maintains a buy rating on CSL but has lifted its 12-month share price from $147.59 to $187.71.
Pro Medicus delivers ‘margin masterclass’ Medical imaging software provider Pro Medicus posted its FY26 results which Morgans healthcare analyst Iain Wilkie described as a “margin masterclass”. “Margin execution was the standout and the key watch item,” he wrote in a research note. “EBIT margin of 74.9% and constant currency (cc) EBIT growth of 30.6% beat expectations comfortably, confirming the H2 implementation ramp flagged at the half is now flowing through the P&L.” Wilkie wrote that foreign exchange “did the damage to reported growth, not the business”. “Revenue and EBIT would have been $273.5m and $206m, respectively, at flat exc
