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:
Macquarie Group Ltd (ASX: MQG)
According to a note out of Citi, its analysts have retained their sell rating and $125.00 price target on this investment bank’s shares. Citi believes it is inevitable that Macquarie will be forced to guide to an earnings decline next year. This is due to some significant one-offs boosting its profits this year. In light of this, the broker believes its shares are overvalued at the current level. The Macquarie share price was fetching $156.25 at the end of the week.
Magellan Financial Group Ltd (ASX: MFG)
A note out of Goldman Sachs reveals that its analysts have retained their sell rating and $45.56 price target on this fund manager’s shares. The broker has concerns over the deterioration of its investment performance and fears it could impact fund inflows and revenue. As result, it believes its shares are expensive at the current level. The Magellan share price was trading at $48.48 at Friday’s close.
Zip Co Ltd (ASX: Z1P)
Analysts at UBS have retained their sell rating but lifted their price target on this buy now pay later (BNPL) provider’s shares to $6.50. According to the note, while the broker was pleased with Zip’s strong growth during the third quarter, it isn’t enough for a change of rating. UBS notes that Zip is still a relatively early stage investment with significant execution risks. It also has concerns over what will happen when COVID stimulus payments end. The Zip share price ended the week notably higher than this price target at $9.36.
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More reading
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- Brokers name 3 ASX shares to buy now
- ASX 200 rises, Zip sinks, BOQ reports
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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 ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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