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:
Cochlear Limited (ASX: COH)
According to a note out of UBS, its analysts have retained their sell rating and $160.50 price target on this hearing solutions company’s shares. The broker expects Cochlear to report a sharp decline in profit in FY 2020 because of the pandemic. In addition to this, it appears concerned that FY 2021 could underwhelm as well due to rising coronavirus cases and the impact this may have on elective surgeries. And while it expects a rebound in unit sales once the pandemic passes, it doesn’t see enough value in its shares at this point to make any changes to its recommendation. The Cochlear share price ended the week at $189.14.
National Australia Bank Ltd (ASX: NAB)
A note out of the Macquarie equities desk reveals that its analysts have downgraded this banking giant’s shares to an underperform rating with a $17.50 price target. According to the note, the broker suspects that NAB’s overweight exposure to small businesses means it is at risk of being impacted more than most by loan deferrals. It fears this and the weak economic outlook could weigh on its short term earnings. The NAB share price last traded at $16.96.
ResMed Inc. (ASX: RMD)
Another note out of the Macquarie equities desk reveals that its analysts have retained their underperform rating but lifted their price target on this sleep treatment company’s shares to $20.00. According to the note, ResMed delivered a stronger than expected fourth quarter and full year result last week. However, this was due to ventilator sales because of the pandemic, which offset softer than expected mask sales. Looking ahead, Macquarie believes its near term outlook is a little challenging and its growth is unlikely to justify the premium its shares trade at $25.06.
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More reading
- 5 things to watch on the ASX 200 next week
- These were the worst performing ASX 200 shares last week
- 3 outstanding ASX shares to buy in August
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- The latest ASX 200 stocks downgraded by top brokers
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia has recommended Cochlear Ltd. and ResMed Inc. 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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