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Will CSL overtake CBA as the largest ASX 200 stock in 2020?

Kenneth Hall
climb, race, top, overtake,

CSL Limited (ASX: CSL) shares have been on a bullish run in 2019 on the ASX 200. The Aussie healthcare group’s share price is up 52.42% since the start of January and is strongly outperforming.

The S&P/ASX 200 Index (INDEXASX: XJO) is up 22.95% in a strong year for capital gains. However, CSL has been surging higher and its market cap has swelled to $128.25 billion.

That makes CSL’s market capitalisation the second-largest amongst the ASX 200 right now. The biotechnology group is second in size only to Commonwealth Bank of Australia (ASX: CBA)’s $144.68 billion valuation.

Can CSL overtake Commonwealth Bank as the largest ASX 200 company?

The CSL share price continues to hit record high after record high. The group’s share price is up a whopping 36,787.73% since its 3-for-1 stock split-adjusted 1994 IPO price of just 76.6 cents.

That means $10,000 invested in the company’s 1994 IPO would be worth a tidy $3,678,773 today.

Consistent earnings, strong research and development (R&D) results and operational expansion have combined to fuel the ASX 200 healthcare group in recent years.

Meanwhile, Commonwealth Bank of Australia (ASX: CBA) has struggled for gains in 2019 despite being the best of the Big Four.

The Aussie bank’s shares are up 15.16% this year to trail the ASX 200 index’s performance by quite a margin.

However, Westpac Banking Corp (ASX: WBC) shares are in the negative as it continues to be plagued by the AUSTRAC scandal

National Australia Bank Ltd (ASX: NAB) and Australia and New Zealand Banking Group (ASX: ANZ) shares have gained in the mid-single-digits this year.

At this point, Commonwealth Bank’s $144.68 billion valuation is greater than NAB ($73.73 billion) and ANZ ($70.55 billion) combined.

However, next year could be the year that CSL finally ends the ASX banking sector’s supremacy in the ASX 200.

CSL shares would need to gain a further 12.81% to get to Commonwealth Bank’s current market capitalisation.

That’s not out of the question given its share price is up 678.62% since the start of 2011, meaning CSL could become the king of the ASX 200 in 2020.

The post Will CSL overtake CBA as the largest ASX 200 stock in 2020? appeared first on Motley Fool Australia.

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Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of National Australia Bank Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019