It’s already August 2021. There could be some ASX shares worth looking at for the long-term.

Share prices are always changing so it can open up different opportunities. There are some businesses that are continuing to demonstrate growth.

These two ASX shares could be ideas to think about:

Volpara Health Technologies Ltd (ASX: VHT)

Volpara is a leading business in the healthcare technology space. It provides breast screening software with a suite of products.

It has grown its market share to around 33% of US women. An important statistic for Volpara is the growth of its subscription-based cash receipts and its annual recurring revenue (ARR).

The ASX share recently announced that in the first quarter of FY22, its subscription-based receipts had increased by 38% to NZ$6.1 million. ARR reached around NZ$27.8 million.

Volpara’s customer churn continues to remain low, so customers are seemingly liking the product. This is leading to increasing customer value.

The healthcare business also said that the merger with CRA Health is exceeding expectations and continues to go well. Risk and genetics are a key focus for FY22.

Volpara says that it has a pipeline of new deals lining up thanks to networks, customer referrals and digital marketing. It also has the potential of a “very significant” upselling opportunity ahead as it finishes upgrading MRS 6 users and start moving MRS 7 users to the far more powerful and compelling ‘patient hub’, along with Volpara products. So far, Volpara has seen a 200% to 300% increase in recurring revenue for those that upgrade.

A lot of new sales are now with two or three products, representing “significantly increased” average revenue per user (ARPU). The relationship with genetics companies is expected to increase that further.

Adairs Ltd (ASX: ADH)

Adairs is a leading homewares and furnishings ASX share retailer.

The business has capitalised on the increased demand for consumers spending on their homes. It has also managed to sell a large amount of products online over the last year and a half.

Adairs is working on a number of initiatives to improve its long-term profit.

One element is the work it’s doing on its supply chain. Its new DHL-operated national distribution centre is expected to deliver annual savings of around $3.5 million per annum once fully operational. It should also lead to improved stock flow and online order fulfilment. Other advantages include increased capacity and improved service levels for online and stores during peak trading periods.

Its stores are another important focus for Adairs. The ASX share says that larger stores are more profitable and that significant upsizing opportunities remain within the current portfolio.

When a store upsizes, it gives the ability to showcase more products and categories. It also leads to an average increase of 950 basis points in the store’s contribution profit margin. A typical upsized store by the ASX share delivers between $250,000 to $350,000 more profit annually after upsizing, representing approximately a 60% average increase in profit.

New profitable store opportunities remain, according to management.

According to Commsec, the Adairs share price is valued at 12x FY22’s estimated earnings.

The post 2 ASX shares that could be buys in August 2021 appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ADAIRS FPO. The Motley Fool Australia owns shares of and has recommended ADAIRS FPO and VOLPARA FPO NZ. 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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The Afterpay Ltd (ASX: APT) share price is likely to rocket higher on Monday morning.

This follows news that the buy now pay later (BNPL) provider has received a takeover approach from US payment giant Square Inc.

What was announced?

This morning Afterpay announced that it has entered into a scheme implementation deed under which Square has agreed to acquire the BNPL provider via a recommended court-approved scheme of arrangement.

According to the release, the two parties have agreed an all-scrip deal, which will see Afterpay shareholders receive a fixed exchange ratio of 0.375 shares of Square Class A common stock for each Afterpay share they hold on the record date. Square may also elect to pay 1% of total consideration in cash.

Based on the latest Square share price of US$247.26, this implies a transaction price of approximately $126.21 per Afterpay share and values the deal at approximately US$29 billion or A$39 billion.

While the offer price represents a 30.6% premium to the current Afterpay share price, it is a 21% discount to its 52-week high of $160.05.

Nevertheless, the Afterpay Board has unanimously recommended the transaction to Afterpay shareholders. This is subject to no superior proposal and an independent expert concluding that the transaction is in the best interests of shareholders.

The release notes that Square has agreed to establish a secondary listing on the Australian share market to allow Afterpay shareholders to trade Square shares via CHESS Depositary Interests (CDIs). Furthermore, Afterpay shareholders will be able to elect whether to receive the consideration in NYSE listed Square Class A common stock or CDIs. The CDIs are expected to be eligible for S&P index inclusion in Australia.

The closing of the transaction is expected in the first quarter of calendar year 2022, subject to the satisfaction of certain closing conditions.

Transaction rationale

Management notes that the acquisition aims to enable the companies to better deliver compelling financial products and services that expand access to more consumers and drive incremental revenue for merchants of all sizes.

Square Co-Founder and CEO, Jack Dorsey, commented: “Square and Afterpay have a shared purpose. We built our business to make the financial system more fair, accessible, and inclusive, and Afterpay has built a trusted brand aligned with those principles. Together, we can better connect our Cash App and Seller ecosystems to deliver even more compelling products and services for merchants and consumers, putting the power back in their hands.”

Square expects Afterpay to accelerate its strategic priorities for its Seller and Cash App ecosystems and plans to integrate the Afterpay service into its existing Seller and Cash App business units, enabling even the smallest of merchants to offer BNPL at the checkout.

Afterpay’s Co-Founders and Co-CEOs, Anthony Eisen and Nick Molnar, jointly commented: “By combining with Square, we will further accelerate our growth in the U.S. and globally, offer access to a new category of in-person merchants, and provide a broader platform of new and valuable capabilities and services to our merchants and consumers. We are fully aligned with Square’s purpose and, together, we hope to continue redefining financial wellness and responsible spending for our customers.”

“The transaction marks an important recognition of the Australian technology sector as homegrown innovation continues to be shared more broadly throughout the world. It also provides our shareholders with the opportunity to be a part of future growth of an innovative company aligned with our vision,” they concluded.

Both Eisen and Molnar will join Square upon completion of the transaction and help lead Afterpay’s respective merchant and consumer businesses. Square will appoint one Afterpay director as a member of the Square Board following closing.

The Afterpay share price is down 19% in 2021.

The post Afterpay (ASX:APT) to be acquired by Square for $39bn appeared first on The Motley Fool Australia.

More reading

• These were the worst performing ASX 200 shares in July
• Analysts name Afterpay (ASX:APT) and this ASX share as buys
• How China’s war on tech companies can hit ASX shares where it hurts
• ASX 200 falls, NAB rises, Afterpay sinks
• Why Afterpay, Redbubble, & Zip shares are sinking on Friday

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. owns shares of and has recommended AFTERPAY T FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. 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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With low interest rates likely to be here for some time to come, it certainly is a difficult time for income investors.

While this is disappointing, investors need not worry. This is because there are plenty of ASX dividend shares that can help you overcome low rates. Two to look at are listed below:

Accent Group Ltd (ASX: AX1)

Accent is a retail group with a collection of popular footwear-focused store brands. These include stores such as Glue Store, HYPEDC, Platypus, Sneaker Lab, Stylerunner, and The Athlete’s Foot.

But it may not stop there. Accent isn’t afraid to test the waters with new ideas and has recently launched another new store brand called 4 Workers. Based on past launches, if this is a success management is likely to throw capital behind the brand and expand its store network over the coming years. 

This strategy has been a major success over the last decade and has underpinned solid earnings and dividend growth.

One broker that expects this positive form to continue is Bell Potter. It currently has a buy rating and $3.30 price target on its shares. The broker is also forecasting dividends of 11.7 cents per share in FY 2021 and 12.3 cents per share in FY 2022.

Based on the latest Accent share price of $2.73, this represents fully franked yields of 4.3% and 4.5%, respectively.

Suncorp Group Ltd (ASX: SUN)

Another dividend share to look at is Suncorp. Like Accent, it works through a number of leading brands such as AAMI, Apia, Bingle, GIO, Shannons, Vero, and the eponymous Suncorp brand. For over a century the company has been building futures and protecting what matters by offering insurance, banking, and wealth products and services.

During this time Suncorp has built up a significant market position, making it one of the main forces in the industry in Australia. This puts it in a great position to benefit from the industry’s improving trading conditions and positive outlook.

Goldman Sachs is very positive on the company’s future and recently retained its buy rating and lifted its price target to $12.08. It is also forecasting generous dividend payments over the coming years.

Goldman is expecting the company to reward shareholders with fully franked dividends per share of 60 cents in FY 2021, 57 cents in FY 2022, and then 69 cents in FY 2023. Based on the current Suncorp share price of $11.54, this will mean yields of 5.2%, 4.9%, and 6%, respectively.

The post 2 excellent ASX dividend shares given buy ratings appeared first on The Motley Fool Australia.

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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 has recommended Accent Group. 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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The IDP Education Ltd (ASX: IEL) share price was on form in July.

The language testing and student placement company’s shares rose as sizeable 15% over the period

This means the IDP Education share price is now up almost 37% since the start of the year.

Why did the IDP Education share price storm higher in July?

There were a couple of catalysts for the strong rise by the IDP Education share price last month.

One of those was the announcement of a major new acquisition on the first day of the month. IDP Education revealed that it has entered into an agreement to acquire the British Council’s Indian International English Language Testing System (BC IELTS India) operations for 130 million pounds (~A$240 million).

This deal means that IDP Education will soon be the sole distributor of IELTS in the key Indian market.

In addition, the acquisition is expected to be significantly accretive to earnings. Management estimates that the transaction will be ~13% earnings per share accretive (pre-synergies) on a pro forma calendar year 2019 basis. It also sees scope for material combination benefits, with estimated run-rate synergies of A$6 million to A$8 million expected to be delivered within 24 months of completion.

What else supported its shares?

Also boosting the IDP Education share price was the positive reaction to the deal by brokers.

For example, in response to the announcement, Goldman Sachs retained its buy rating and lifted its price target on its shares to $35.00.

Based on the current IDP Education share price, this price target implies potential upside of 24% over the next 12 months even after last month’s gains.

The broker was a fan of the deal and suspects that it may not be the final acquisition the company makes.

Goldman commented: “In our view, the acquisition of BC’s Indian IELTS operations is an indication of IEL’s willingness to deploy capital toward synergistic acquisitions, and may pave the way for further transactions in other countries. While we take no view on any specific transactions, we move our target price methodology to DCF and apply an uplift of A$3.20 to our DCF to capture the potential value from further acquisitions. Our new 12-month TP is A$35.00 […] we reiterate our Buy rating.”

The post Here’s why the IDP Education (ASX:IEL) share price jumped 15% in July appeared first on The Motley Fool Australia.

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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. owns shares of and has recommended Idp Education Pty Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. 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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On Friday the S&P/ASX 200 Index (ASX: XJO) finished the month on a disappointing note. The benchmark index fell 0.3% to 7,392.6 points.

Will the market be able to bounce back from this on Monday? Here are five things to watch:

ASX 200 poised to bounce back

The Australian share market is expected to bounce back on Monday. According to the latest SPI futures, the ASX 200 is expected to open the day 37 points or 0.5% higher this morning. This is despite a poor end to the week on Wall Street, which saw the Dow Jones fall 0.4%, the S&P 500 drop 0.55%, and the Nasdaq tumble 0.7% lower.

Oil prices push higher

Energy producers such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could be on the rise today after oil prices pushed higher. According to Bloomberg, the WTI crude oil price is up 0.45% to US$73.95 a barrel and the Brent crude oil price has risen 0.4% to US$75.41 a barrel. Forecasts for tight supplies gave oil prices a boost. Oil prices rose on hopes that demand is growing faster than supply.

Pro Medicus downgraded

The Pro Medicus Limited (ASX: PME) share price could come under pressure today. This morning Goldman Sachs downgraded the health imaging technology company’s shares to a neutral rating with a $55.60 price target. The broker made the move on valuation grounds after a strong period of share price performance. It notes that its shares are now trading 63% above five-year average multiples.

Gold price tumbles

Australian gold miners such as Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) could come under pressure today after the gold price tumbled on Friday night. According to CNBC, the spot gold price fell 1% to US$1,817.20 an ounce. The gold price weakened after the firmer US dollar ended the Federal Reserve inspired rally last week.

Iron ore price sinks

BHP Group Ltd (ASX: BHP) and Fortescue Metals Group Limited (ASX: FMG) shares could start the week in the red after the spot iron ore price continued its decline. According to Metal Bulletin, the iron ore price has fallen a further 7.5% to US$181.57 a tonne. This has been driven by Chinese steel output cuts.

The post 5 things to watch on the ASX 200 on Monday appeared first on The Motley Fool Australia.

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• These were the best performing ASX 200 shares in July
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• The BHP (ASX:BHP) share price is up 21% in the last 6 months. Is now a good time to buy shares in this ASX 200 giant?
• 2 outstanding ASX 200 blue chip shares named as buys for August
• How China’s war on tech companies can hit ASX shares where it hurts

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. owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. 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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Last week saw a number of broker notes hitting the wires once again. Three buy ratings that caught my eye are summarised below.

Here’s why brokers think investors ought to buy them next week:

Life360 Inc (ASX: 360)

According to a note out of Credit Suisse, its analysts have retained their outperform rating and lifted their price target on this family focused app maker’s shares to $10.00. This follows the release of the company’s second quarter update. Credit Suisse has been impressed with its performance during the pandemic both in respect to customer growth and costs. It suspects the company could outperform its guidance in FY 2021 if current trading conditions persist. The Life360 share price was fetching $7.97 at Friday’s close.

Qantas Airways Limited (ASX: QAN)

A note out of Morgan Stanley reveals that its analysts have retained their overweight rating and $7.00 price target on this airline operator’s shares. While the broker notes that Qantas’ recovery is uncertain given recent lockdowns, it remains confident that there is significant upside when trading conditions return to normal. Morgan Stanley expects domestic capacity to average 80% of normal levels and international capacity to be 10% in FY 2022. The Qantas share price ended the week at $4.59.

Temple & Webster Group Ltd (ASX: TPW)

Another note out of Credit Suisse reveals that its analysts have retained their outperform rating and lifted their price target on this online furniture and homewares retailer’s shares to $14.62. This follows the release of a strong full year result last week. Credit Suisse believes the company is well-placed for growth thanks to its strong market position and increasing online penetration. This is expected to be supported by its increased investment in marketing to grow brand awareness. The Temple & Webster share price was trading at $11.95 at Friday’s close.

The post Top brokers name 3 ASX shares to buy next week appeared first on The Motley Fool Australia.

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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. owns shares of and has recommended Life360, Inc. and Temple & Webster Group Ltd. The Motley Fool Australia has recommended Temple & Webster Group Ltd. 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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It certainly was an eventful month for the Zip Co Ltd (ASX: Z1P) share price in July.

The buy now pay later (BNPL) provider’s shares were up as much as 16% month to date on 8 July before giving back all of this and more.

The Zip share price ultimately ended the period with a monthly decline of 12.3%.

Why did the Zip share price tumble lower last month?

There were a couple of catalysts for the weakness in the Zip share price in July.

One of those was concerns about increasing competition in the BNPL market. This follows news that PayPal is removing late fees from its BNPL service and rumours that Apple is entering the market.

In respect to the latter, Bloomberg reported that Apple is planning to disrupt the BNPL market with the launch of Apple Pay Later in the near future. This is believed to be part of the company’s plan to increase transaction volumes through Apple Pay, boosting its US$50 billion Services business.

There are fears that Apple’s entry could steal customers away from Zip and its QuadPay business, putting pressure on growth rates in the coming years.

What else weighed on its shares?

Also weighing on the Zip share price was the release of its fourth quarter results.

Zip delivered another record performance, reporting a 116% year on year increase in quarterly total transaction volume (TTV) to $1.8 billion and a 104% increase in quarterly revenue to $129.9 million. Positively, this was driven by record monthly revenue of $44.8 million in June, which annualises at $537.2 million.

Once again, its US-based QuadPay business was the key driver of its growth during the quarter. It reported a 107% year on year increase in revenue to $64.3 million. This was supported by a 39% lift in revenue in the ANZ and a modest contribution by its fledgling UK business.

Given that this was largely in line with the market’s expectations, investors may be wondering about the weakness in the Zip share price following its release.

That has been attributed to the fact that management didn’t comment on takeover speculation. This followed reports that rival Klarna has been building up a position in the company.

If these rumours are true, Klarna will no doubt be licking its lips at the pullback in the Zip share price in July. But time will tell if the reports amount to anything.

The post Why did the Zip (ASX:Z1P) share price tumble 12% in July? appeared first on The Motley Fool Australia.

More reading

• Why Afterpay, Redbubble, & Zip shares are sinking on Friday
• Own Zip (ASX:Z1P) shares? Here’s what to look for during reporting season
• Zip (ASX: Z1P) share price booms, IRESS gets a takeover offer. Scott Phillips on Nine’s Late News
• Why the Afterpay (ASX:APT) share price is in the green today
• Here’s why the Zip Co (ASX:Z1P) share price is leaping 5% today

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. owns shares of and has recommended ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. 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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There are a few ASX shares that multiple brokers like simultaneously right now.

A business that many brokers like at once might indicate that it’s an opportunity for investors to think about.

Brokers are always on the lookout for ideas that could be good to own. Of course, they could all be wrong at the same time.

Keeping that in mind, here are two that are liked by the broker industry:

IOOF Holdings Limited (ASX: IFL)

IOOF is a large financial services business. It provides financial advice through its network of financial advisers, portfolio and estate administration for advisers, their clients and hundreds of employers, and investment management products.

It’s currently rated as a buy by at least three brokers. One of the brokers that likes IOOF is Citi with a price target of $4.95. The broker was impressed by its quarterly update for the three months to 30 June 2021. One of the highlights was the net inflows in some areas.

IOOF’s portfolio and estate administration saw $606 million of net inflows and investment management saw a turnaround in flows with “robust” net inflows of $90 million.

However, financial advice saw $1.8 billion of net outflows, and pensions and investments (P&I) experienced net outflows of $895 million. The outflows were not as bad for the ASX share as the broker had been thinking.

Funds under management, advice and administration (FUMA) at 30 June 2021 was $213.3 billion, which was an increase of $9.4 billion over the quarter thanks to market movements.

MLC’s assets under management and funds under administration were $301.2 billion, up $11.4 billion over the fourth quarter. Currently, the two different businesses use different reporting methodology.

According to Citi, IOOF is valued at 12x FY22’s estimated earnings with a forward grossed-up dividend yield of 7.5%.

Telstra Corporation Ltd (ASX: TLS)

The telco giant is another ASX share that brokers like. It’s currently rated as a buy by at least four brokers including Credit Suisse.

The broker points to the asset sale of a minority stake of its towers business as a reason to be positive about the telco.

A few weeks ago, Telstra announce that it was going to sell 49% of its towers business for $2.8 billion as well as announcing returns for shareholders.

This towers business has approximately 8,200 towers, it’s the largest mobile tower infrastructure provider in Australia.

Telstra expects net cash proceeds after transaction costs of $2.8 billion at completion, which is expected in the first quarter of FY22.

The ASX share said it intends to return approximately 50% of net proceeds to shareholders in FY22.

Telstra said it was able to maximise overall value for shareholders whilst maintaining control of the assets. But it was also important for Telstra to preserve its “strategic differentiation in mobiles and protect” its “network leadership”.

The ASX share has entered into a 15-year agreement (with the option to extend) to secure ongoing access to existing and new towers.

Some of the net proceeds will be used to reduce debt so it can maintain balance sheet strength and flexibility.

The post 2 ASX shares rated as strong buys by brokers appeared first on The Motley Fool Australia.

More reading

• Top ASX shares to buy in August 2021
• Telstra (ASX:TLS) share price slips as Optus teams up with Uber
• Telstra (ASX:TLS) share price on watch after NBN news
• Here are 3 of the most heavily traded ASX 200 shares this Thursday
• Telstra (ASX:TLS) share price and improving sector dynamics – Expert

Motley Fool contributor Tristan Harrison 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 Telstra Corporation 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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The S&P/ASX 200 Index (ASX: XJO) was on form again in July. The benchmark index recorded a 1.1% gain to end the month at 7,392.6 points.

While a good number of shares climbed higher with the market, some climbed more than others. Here’s why these were the best performing ASX 200 shares in July:

Perenti Global Ltd (ASX: PRN)

The Perenti share price was the best performer on the ASX 200 last month with a 35.8% gain. There were a number of catalysts for this strong rise. This includes its Barminco business finalising a $280 million four-year contract with Panoramic Resources Limited (ASX: PAN) and a bullish broker note out of Macquarie. In respect to the latter, Macquarie put an outperform rating and 95 cents price target on its shares. The broker believes Perenti’s work in hand and order book will support strong free cash flow and underpin a generous dividend.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

The Sydney Airport share price wasn’t far behind with 34.9% gain. Investors were fighting to get hold of the airport operator’s shares after it received an $8.25 cash per share takeover offer from a consortium of infrastructure investors. This offer represented a 42% premium to its last close price at the time and valued the airport operator at $22.3 billion. However, Sydney Airport rejected the offer, noting that it was made during a global pandemic, which has deeply affected the aviation industry and the Sydney Airport share price. Investors appear optimistic an improved offer will be made.

Lynas Rare Earths Ltd (ASX: LYC)

The Lynas share price was a strong performer in July and recorded a 28.5% gain. A good portion of this gain was made in the final week of the month following the release of its fourth quarter update. That update revealed that Lynas achieved a 79.7% increase in quarterly neodymium and praseodymium (NdPr) production to 1,393 tonnes during the three months. Together with the near doubling of its average realised price, Lynas reported a 389% increase in quarterly sales revenue to $185.9 million.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price was on form again and stormed 22% higher in July. This is despite the lithium miner’s shares spending the latter few days of the month in a trading halt. Investors were buying the company’s shares after investor sentiment in the industry increased further following a series of positive quarterly updates from lithium miners. Those updates revealed strong demand and pricing for lithium.

The post These were the best performing ASX 200 shares in July appeared first on The Motley Fool Australia.

More reading

• These were the worst performing ASX 200 shares in July
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• ASX 200 falls, NAB rises, Afterpay sinks

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 has no position in any of the stocks mentioned. 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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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:

Commonwealth Bank of Australia (ASX: CBA)

According to a note out of Morgan Stanley, its analysts have retained their underweight rating and $89.00 price target on this banking giant’s shares. The broker is expecting a solid result from Australia’s largest bank later this month. However, it does have concerns over its outlook commentary given the current lockdowns. Outside this, the broker continues to believe its shares are expensive at the current level and recommends that investors look elsewhere in the sector. The CBA share price ended the week at $99.65.

Paradigm Biopharmaceuticals Ltd (ASX: PAR)

A note out of Morgans reveals that its analysts have retained their reduce rating and $1.69 price target on this biopharmaceutical company’s shares. This follows the release of its fourth quarter update. Morgans has been surprised with how much Paradigm has invested on preparing its osteoarthritis treatment product’s regulatory submission. And with major trial costs still to come and no partnership deals currently, it suspects that the company could require a capital raising. Morgans has also previously voiced concerns over the commercial viability of the product and heavy insider selling. The Paradigm share price was fetching $2.22 at Friday’s close.

Rio Tinto Limited (ASX: RIO)

Analysts at UBS have retained their sell rating and cut their price target on this mining giant’s shares to $102.00. UBS continues to believe that Rio Tinto’s shares are overvalued given how much iron ore contributes to its free cash flow and its expectation for a sharp pullback in the price of the steel making ingredient. It expects the latter to be driven by a build-up in inventories due to softening demand and increasing supply. The Rio Tinto share price ended the week at $133.42.

The post Top brokers name 3 ASX shares to sell next week appeared first on The Motley Fool Australia.

More reading

• How China’s war on tech companies can hit ASX shares where it hurts
• These ASX 200 lithium shares have all surged more than 20% in a month
• What’s moving the Commonwealth Bank (ASX:CBA) share price this week
• Here’s how much the massive new Rio Tinto (ASX:RIO) dividend is worth
• ASX 200 shares in this sector pushing into record highs on Friday

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 has no position in any of the stocks mentioned. 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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