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:
A2 Milk Company Ltd (ASX: A2M)
Analysts at Credit Suisse have retained their underperform rating but lifted their price target on this infant formula company’s shares to $5.50. The broker has lifted its price target to reflect slightly better than expected infant formula demand, which has resulted in an increase to its earnings estimates. Nevertheless, these estimates are still below consensus. UBS has concerns over the daigou channel and the lack of differentiation for its English label products. The A2 Milk share price was trading at $7.20 at Friday’s close.
Commonwealth Bank of Australia (ASX: CBA)
According to a note out of Morgans, its analysts have retained their reduce rating but increased their price target on this banking giant’s shares to $76.00. While Morgans is positive on the banking sector and is forecasting improvements in CBA’s return on equity and significant capital management, it isn’t enough for a change of rating. The broker continues to believe that the bank’s shares are expensive and therefore retains its reduce rating. The CBA share price ended the week at $98.59.
Macquarie Group Ltd (ASX: MQG)
A note out of Citi reveals that its analysts have retained their sell rating and $140.00 price target on this investment bank’s shares. This follows news that Macquarie has signed an agreement to acquire the global equities and fixed income business of AMP Ltd (ASX: AMP). Citi sees this as a signal that Macquarie is intending to build global scale in public markets. And while it sees positives from the deal and further opportunities to deploy excess capital, it feels its valuation is stretched and suspects the market is expecting too much from the company in respect to its earnings. The Macquarie share price was trading at $154.19.
The post Top brokers name 3 ASX shares to sell next week appeared first on The Motley Fool Australia.
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More reading
- These were the best performing ASX 200 shares last week
- Why A2 Milk and Bega shares are looking so tasty now: analyst
- Brokers name 3 ASX shares to buy today
- ASX 200 midday update: Afterpay & CBA sink, Viva Energy jumps
- Why this leading fund manager is backing better times ahead for the Macquarie (ASX:MQG) share price
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia has recommended A2 Milk. 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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