Why ASX Healthcare Stocks Are Crashing- and Which One Looks Like a Buy

ASX healthcare stocks are crashing- which one is worth buying now?

Three of Australia’s most premium ASX healthcare stocks have been crushed in the same week. CSL (ASX: CSL) has fallen to its lowest price since 2018, plunging 15% in a single week to touch a low of A$150. Pro Medicus (ASX: PME) has plunged nearly 30% this week alone despite posting record revenue and now sits roughly 65% below its July 2025 record high of A$336. And Cochlear (ASX: COH) tumbled 17% after guiding to the lower end of its profit range. The question isn’t what happened; it’s why solid businesses got punished this hard and whether any of them are now genuinely cheap.

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What’s Actually Driving the ASX Healthcare Stocks Sell-Off

This isn’t about one bad result. Three forces are hitting at the same time.

First, AI disruption fears have been compressing valuations across software and healthcare technology globally. Pro Medicus caught the worst of it because its imaging platform sits in the crosshairs of that narrative, though Morgan Stanley has argued these fears are overblown.

Second, all three stocks were priced for perfection. At 100-plus times earnings for Pro Medicus and premium multiples for the others, there was no room for “good but not great.” Third, the stronger Australian dollar is hurting all three, since each generates most of its revenue in US dollars.

In our view, the valuation reset is the biggest factor. AI fears added fuel, but these stocks were simply priced too richly for anything less than flawless execution.

CSL, Pro Medicus, Cochlear: How Each Result Actually Stacked Up

CSL (ASX: CSL): Underlying earnings fell 7% to US$1.9 billion, while statutory profit dropped 81% due to US$1.1 billion in one-off impairments. The sudden retirement of CEO Paul McKenzie on the eve of the results added to the panic, with veteran Gordon Naylor stepping in as interim CEO. It looks ugly on the surface, but the core plasma business remains intact, and guidance was maintained. The sell-off feels overdone.

Pro Medicus (ASX: PME): Revenue surged 28% to A$124.8 million and underlying profit rose 30%. By any normal standard, an excellent result, though the statutory profit of A$171.2 million was inflated by roughly A$149 million in unrealised gains from its 4DMedical investment. But at over 100 times earnings, “excellent” wasn’t enough. The stock is now trading at nearly a third of its July 2025 peak value.

Cochlear (ASX: COH): The genuinely soft result of the three. Revenue dipped 2% on a constant-currency basis to A$1.18 billion, underlying profit fell 9%, and the rollout of the new Nexa implant system took longer than expected. This disappointment looks more fundamental.

Why CSL Looks Like the Real Buying Opportunity in This Sell-Off

We believe CSL is the standout opportunity. At around A$150, the stock trades at roughly 20 times underlying earnings, its cheapest valuation in 14 years. For a global biotech leader with dominant market positions in plasma therapies, that kind of discount rarely appears.

The headline 81% profit drop is almost entirely driven by one-off restructuring costs and asset impairments, not operational deterioration. Cash flow from operations remained solid at US$1.3 billion, and management expanded the buyback to US$750 million, signalling confidence at these levels. The transformation program targets US$500–$550 million in annual savings by FY28.

The risks are real; CSL Behring’s revenue dipped 7%, the CEO transition adds uncertainty, and the Seqirus vaccine business is struggling. But at 20 times underlying earnings with a path to margin recovery, we believe the market has overpriced short-term noise and underpriced the long-term franchise.

For patient investors with a two- to three-year horizon, CSL at these levels appears to be an opportunity that doesn’t come around often. Conservative investors might wait for clarity on the CEO transition, but this is the ASX healthcare stock we’d be watching most closely.