Once again, a large number of broker notes hit the wires last week. Some of these notes were positive and some were bearish.
Three sell ratings that caught my eye are summarised below. Here’s why top brokers think investors ought to sell these shares next week:
Afterpay Ltd (ASX: APT)
The bearish analysts at UBS have retained their sell rating but lifted the price target on this payments company’s shares slightly to $14.00. According to the note, the broker was impressed with its growth in the U.S. market, but feels it is a little soon to get excited. It notes that this has been driven by lockdowns and store closures and shouldn’t be extrapolated by investors. The Afterpay share price ended the week materially higher than the broker’s price target at $47.41.
Tabcorp Holdings Limited (ASX: TAH)
A note out of Citi reveals that its analysts have resumed coverage on this gambling company’s shares with a sell rating and $2.80 price target. The broker notes that Tabcorp is facing a number of headwinds. These include store closures, sports betting uncertainty, and the cycling of a run of large lottery jackpots from last year. In light of this, it expects the company’s earnings to come under pressure in FY 2020 and FY 2021. The Tabcorp share price last traded at $3.22.
Wesfarmers Ltd (ASX: WES)
According to another note out of Citi, its analysts have retained their sell rating but lifted the price target on this conglomerate’s shares to $36.00. The broker sees positives in its decision to consolidate the Target store network. It has also upgraded its earnings estimates to reflect stronger growth from the Bunnings and Officeworks business. However, this isn’t enough for a change of rating. The broker continues to believe its shares are fully valued and retains its sell rating. Wesfarmers’ shares ended the week at $40.37.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO and Wesfarmers 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.
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