The Little Green Pharma Ltd (ASX: LGP) share price climbed higher today after the company announced it has delivered its first French shipment. By the close of trade, the medicinal cannabis company’s shares had moved up by 5.47% to an intraday high 67.5 cents.

What did Little Green Pharma announce?

The Little Green Pharma share price trekked upwards after the company provided investors with the positive news.

According to its release, Little Green Pharma has completed the first shipment of its medicinal cannabis oils to the French national trial.

Authorities will test the first batch of the 4,800 units which will be made available to trial patients sometime this month. The company hopes that having a first-mover advantage in the country could set it up for potential blockbuster growth.

Little Green Pharma is only one of four international cannabis companies that were appointed as primary trial suppliers. The company partnered up with leading French pharmaceutical distributor, Intsel Chimos, to assist in delivering the medicinal cannabis oils.

The French national study is seeking to look at efficacy and safety for patients being treated with medicinal cannabis products. The program is expected to comprise up to 3,000 people and will run for a period of two years.

At the moment, the study represents the only pathway for medicinal cannabis to be supplied to the French market. The trial complements Little Green Pharma’s European strategy which has already seen it enter the United Kingdom and Germany.

Little Green Pharma estimates that the legalised medicinal cannabis sector in France could potentially be worth 4 billion euros (AUD$6.3 billion) annually.

How has the company been performing?

In the six months ending 31 December 2020, Little Green Pharma achieved strong growth with significant unit sales and revenue.

In Australia, the company sold over 21,000 units which represented an increase of 340% on the prior corresponding period. It also exported its first commercial shipment of 2,400 units to Germany 

Total revenue for the first half came to $3.7 million, accelerating 420% from the same time last year.

As a result, Little Green Pharma’s bottom line saw net profit after tax (NPAT) just shy of $0.5 million. This is a massive turnaround for the company which posted a loss of $5.5 million in the prior period.

At the end of the calendar year, the company recorded $4.4 million in cash and equivalents.

Little Green Pharma share price review

Over the past 12 months, the Little Green Pharma share price has gone gangbusters, rising by 125%. Year to date, the company’s shares have gained just over 20%.

Based on the current share price, Little Green Pharma has a market capitalisation of around $81 million.

More reading

• Here’s why the IDP Education (ASX:IEL) share price sank 6% today
• Aussie Broadband (ASX:ABB) share price hits all-time high
• AMP (ASX:AMP) selling assets too cheaply warns Macquarie
• Woolworths (ASX:WOW) share price down as it savours potential Oakridge Wines purchase
• The Pro Medicus (ASX:PME) share price is up 23% in 2021: Can it go higher?

Motley Fool contributor Aaron Teboneras 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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The IDP Education Ltd (ASX: IEL) share price came under pressure on Thursday afternoon and sank notably lower.

The student placement and language testing company’s shares ended the day almost 6% lower at $22.86.

Why did the IDP Education share price tumble lower?

Investors were hitting the sell button this afternoon after the company released an update on the Education Australia shareholding.

According to the release, following a period of consultation, the Board of Education Australia has entered into an agreement with The British Council and the University of Cambridge regarding a restructure of its shareholding in IDP Education.

Under the restructure, Education Australia will deal with its 40% shareholding in IDP Education by making an in specie distribution of a 25% shareholding to all of its 38 University shareholders. This will mean those shareholders each become the direct owner of 1,831,159 shares in IDP Education.

The remaining 15% stake will be divested via a market selldown, which will occur no later than 11 December 2021.

The company notes that the restructure will not impact IDP Education’s operations or strategy. Furthermore, IDP Education has agreed to not propose or recommend any amendments to the Director Majority Requirement in its Constitution.

It explained: “In broad terms, the ‘Director Majority Requirement’ requires that a majority of IDP directors be (a) where Education Australia has voting power in IDP of at least 10% – either independent or a representative of Education Australia, or (b) in all other circumstances – independent.”

Why is Education Australia doing this?

In Education Australia’s media release, it explained that it was doing this to allow its 38 Australian University shareholders to decide whether or not they wanted to continue holding IDP Education shares.

Education Australia had previously advised that COVID-19 has presented its shareholders with material financial challenges, and that their investment in the company represents a potential source of capital.

It remains unclear just how many of the 38 universities are wanting to cash in their shares. But, given that a number of brokers have buy ratings and price targets of ~$30.00 on its shares, I doubt those wanting to sell will be short of willing buyers.

More reading

• The worst performing ASX 200 shares last week
• 5 ASX shares to buy in a market crash
• ASX 200 Weekly Wrap: ASX finishes higher, despite tech selloff
• These were the worst performing ASX 200 shares last week
• 5 things to watch on the ASX 200 on Thursday

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 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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Aussie Broadband Ltd (ASX: ABB) shares have cruised to a record all-time high of $2.97 on Thursday. The Aussie Broadband share price has surged by 10% this week despite no market-sensitive news from the company. The last significant announcement from Aussie Broadband was its half-year results on 17 February. 

Let’s take a closer look at what’s been happening for the Aussie telco.

Aussie Broadband share price ignoring the noise

The Aussie Broadband share price is ignoring the recent market volatility, including the sharp selloff of tech shares amid fears over rising bond yields. Its shares have pushed higher on Thursday to retest previous record highs set on 27 January. 

Aussie Broadband shares are up there as one of the best performing initial public offerings (IPOs) of 2020. The company had an IPO offer price of $1.00 per share with an indicative market capitalisation of approximately $190 million. 

Aussie Broadband is a licensed carrier that provides NBN subscription plans and bundles to residential homes, small businesses, not-for-profits, corporate and managed services providers.

Despite there being 189 direct and indirect NBN service providers as at June 2020, 92% of market share is concentrated among four main companies, Telstra Corporation Ltd (ASX: TLS), TPG Telecom Ltd (ASX: TPG), Optus and Vocus Group Ltd (ASX: VOC).

While there might be somewhat of an oligopoly in the Australian telecommunications market, Aussie Broadband has managed to grow its NBN market share from 1.09% in June 2017 to 3.51% as at June 2020. 

The company aims to continue growing its market share by leveraging its customer loyalty to deliver new products and pursuing initiatives to acquire more customers. 

Solid half-year results 

Aussie Broadband delivered an impressive half-year result with revenues up 89% to $157.4 million and earnings before interest, taxes, depreciation, and amortisation (EBITDA) up 87% to $7.3 million. The company cited strong organic growth across both its residential and business segments. Its strong results translated to an improvement in market share to 4.2%. 

The company is currently still loss-making, with its half-year results delivering a net loss after tax of $1.4 million. This represents a significant improvement against the $10.5 million loss from the prior corresponding period. Aussie Broadband’s prospectus forecast that FY21 results should deliver a maiden profit of ~$529,000. 

One of few successful IPOs from 2020 

The Aussie Broadband share price represents one of the few IPO success stories (excluding mining exploration companies) from 2020.  

IPOs that hit the ground running last year included Douugh Ltd (ASX: DOU), COSOL Ltd (ASX: COS), Credit Clear Ltd (ASX: CCR) and Dusk Group Limited (ASX: DSK) which have delivered respective returns of around 550%, 220%, 95% and 50%. 

Meanwhile, the likes of Youfoodz Holdings Limited (ASX: YFZ), Plenti Group Ltd (ASX: PLT), Payright Ltd (ASX: PYR), DUG Technology Ltd (ASX: DUG), Adore Beauty Group Ltd (ASX: ABY), and Zebit Inc (ASX: ZBT) have yet to deliver any value to shareholders who participated in their IPOs. 

More reading

• Why is the Macquarie Telecom (ASX:MAQ) share price down today?
• Aussie Broadband (ASX:ABB) share price surges 8% on record revenue

Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Aussie Broadband Limited. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia has recommended Aussie Broadband 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 AMP Ltd (ASX: AMP) share price is under a cloud as a broker warns that it’s selling assets too cheaply.

The news puts AMP shareholders between a rock and a hard place, and I’ll explain why in a moment.

It was the analysts at Macquarie Group Ltd (ASX: MQG) that was sounding the alarm when it looked at the proposed joint venture (JV) between AMP and Ares Management Corp Class A (NYSE: ARES).

AMP’s crown jewels going for a song

The broker found that AMP may be selling a majority stake in its prized private market business at around a whopping 25% discount to Ares!

The business, which forms part of the AMP Capital division, is estimated to generate 91% of divisional earnings before interest and tax (EBIT), according to Macquarie.

If so, the private market unit is being priced on a trailing EBIT multiple of around 16.9 times. This is substantially higher than the multiple of around 12.7 times proposed for the joint venture.

AMP’s turn to reject Ares?

This isn’t an exact science. The difference may be due to the ongoing deterioration in AMP Capital with institutions pulling their mandates.

But even accounting for this risk, Macquarie believes a very material discount exists.

“On our numbers, we do not see how AMP could agree to the deal in the form disclosed to the market,” said Macquarie.

“Should the jewel in the AMP crown be sold at such a steep discount, it would signal an even worse underlying state of the Group (and AMP Capital division) than we are forecasting.”

Shareholders’ dilemma clouds the AMP share price

But herein lies the dilemma for shareholders. AMP needs the JV to proceed to unlock value in the asset after Ares walked away from an earlier proposal to buy the entire group.

The AMP share price slumped the US suitor turned its back and AMP failed to attract any other interested parties.

This puts Ares in the box seat to get their hands on what many call the best bits of AMP at a fire sale price.

Are there any long-term investors left in AMP?

While Macquarie is urging AMP to break off the engagement, shareholders might be less willing to do so.

The AMP share price is sure to tumble if management pulls the plug on the $2.3 billion JV, which would lead to a $1.6 billion cash payoff for the beleaguered wealth manager.

On the other hand, if AMP elected to call off the deal and work on turning around the AMP Capital business, the AMP share price could eventually recover.

But that will take quite a while. For most investors, that might be too long a wait.

More reading

• Bank of Queensland (ASX:BOQ) share price rises as it inks office deal with AMP (ASX:AMP)
• Demoted AMP exec paid $1m bonus for 53 days’ work
• Why the Macquarie (ASX:MQG) share price just hit a record high
• Why the Rio Tinto (ASX:RIO) share price is among the worst performers today
• International Women’s Day: The female CEOs of the ASX

Motley Fool contributor Brendon Lau owns shares of AMP Limited and Macquarie Group Limited. Connect with me on Twitter @brenlau.

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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The Woolworths Group Ltd (ASX: WOW) share price is down today as the Australian Financial Review (AFR) reports the retailer is looking to purchase Oakridge Wines.

As of writing, the Woolworths share price is down 0.51% to $38.67. In comparison, the S&P/ASX 200 Index (ASX: XJO) is 0.23% lower.

Endeavour Group wants Oakridge

Woolworths’ Endeavour Group, which the company will spinoff later this year, is looking to purchase the La Trobe Valley winemaker as it faces increasing competition. Endeavour, which is both a producer and seller of wine, wants to strengthen its wine portfolio. The group’s range of wine brands include Chapel Hill, Barossa Valley, Marlborough, and Coonawarra.

Ilana Atlas and Tony D’Aloisio, owners of Oakridge, both declined to comment when approached by the AFR. Endeavour likewise did not respond to the rumours.

Endeavour, which owns BWS, Dan Murphy’s, and Woolworths’ hotel and hospitality venues, was initially supposed to demerge from the supermarket giant in 2020. The COVID-19 pandemic forced the company to delay the move for at least 12 months.

The AFR is also reporting the spinoff may not even happen at all. Instead, private equity firms Carlyle Group and BGH Capital are “considering making offers” for $13 billion business. Woolworths may not take this deal, however, to avoid a hefty capital gains taxbill.

Woolworths financial performance

In its FY21 half-year report, Woolworths reported a 9.4% jump in gross profit on the prior corresponding period (pcp). Revenues were up 10.5% on the pcp to equal $35.8 billion.

Earnings per share (EPS) came to 90.5 cents – a 28.1% lift on the pcp.

Earnings before interest, tax, depreciation and amortisation (EBITDA) was up 8.7% at $3.4 billion for the six months ending 31 December 2020.

For Endeavour Group, sales for the period totalled $5.7 billion – up 19.0% on the pcp. The group’s EBITDA came in at $564 million,  21.6% higher on the pcp.

Woolworths share price snapshot

The Woolworths share price has been trending downwards for the last month or so. During January and February, Woolworths hit its 52-week record high share price of $42.05. One year ago, shares in the company were swapping hands for $36.05. In percentage terms, the share price has increased by 7.18% over that time.

Woolworths has a market capitalisation of $48.9 billion.

More reading

• International Women’s Day: The female CEOs of the ASX
• ASX 200 up 1.6%: Appen rebounds, ALS acquires Investiga, Woolworths upgraded
• International Women’s Day: Which ASX companies are fighting gender inequality?
• Leading broker upgrades Woolworths (ASX:WOW) shares to buy rating
• ASX 200 Weekly Wrap: ASX finishes higher, despite tech selloff

Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Woolworths 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 Pro Medicus Limited (ASX: PME) share price is edging lower with the market on Thursday.

In afternoon trade, the health imaging company’s shares are down 0.5% to $43.11.

However, despite this, the Pro Medicus share price is still up a sizeable 23% since the start of the year.

Why is the Pro Medicus share price up 23% in 2021?

Investors have been fighting to get hold of the company’s shares this year thanks to a solid half year result, a series of major new contract wins, and a bullish broker note.

In respect to its first half performance, for the six months ended 31 December, Pro Medicus reported a 7.8% increase in revenue to $31.6 million and a 29% (constant currency) increase in underlying profit before tax to $19.7 million.

Positively, since the end of the half, the company has signed two major new contracts. One was a $40 million 7-year deal with Intermountain Health and the other was a $31 million 7-year deal with a large University Health System.

Can Pro Medicus shares go higher?

The good news for investors is that one leading broker believes the Pro Medicus share price can still go higher from here.

That broker is Goldman Sachs. Last month its analysts upgraded the company’s shares to a buy rating with a $53.80 price target.

Based on the current Pro Medicus share price, this implies potential upside of 25% over the next 12 months.

Why is Goldman so positive?

Goldman Sachs has been impressed with the way the company continues to win large contracts despite the difficult operating environment. The broker feels this leaves it well-positioned to grow its earnings at a rapid rate over the coming years.

And although the Pro Medicus share price trades at a premium to the market average, Goldman believes its growth profile justifies this.

It commented: “Whilst not cheap in absolute terms, our new estimates imply a +42% EBITDA CAGR (FY20-23E). In the context of ASX Healthcare, which trades at a ‘multiple to growth’ ratio of 2.9x, we do not see PME’s ratio of 1.4x as demanding, particularly given its position as a technology leader in a market we believe is set for further technology upgrades, and a recurrent revenue model with inherent upside. We upgrade to Buy.”

So, while Pro Medicus shares has been on fire in 2021, it appears as though they may still have further to run in the coming months.

More reading

• Is it ok to buy ASX 200 shares at a 52-week high?
• ASX 200 rises, Afterpay sinks, Vocus jumps
• 5 ASX shares to buy in a market crash
• 2 strong ASX healthcare shares to buy this month
• Is it time to buy these 2 hot ASX healthcare shares?

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 recommends Pro Medicus Ltd. The Motley Fool Australia 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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Wide Open Agriculture Ltd (AXS: WOA) shares are surging today after the company provided investors with a market update. At the time of writing, the Wide Open Agriculture share price is trading 10.77% higher at 72 cents.

At one stage during earlier trade, the regenerative food and farming company’s shares had surged by nearly 17% to 76 cents before retreating to their current level.

Let’s take a closer at the highlights of Wide Open Agriculture’s presentation to investors.

What did Wide Open Agriculture announce?

The Wide Open Agriculture share price is storming higher as investors seem excited about the company’s future prospects.

According to its presentation, Wide Open Agriculture highlighted has achieved sustained growth over the past six quarters with its ‘Dirty Clean Food’ brand portfolio. In the midst of COVID-19, the company recorded $980,000 in revenue per quarter in the final months of 2020. This was underpinned by an uptick in consumer demand for plant-based protein.

In addition, the company noted its ability to quickly adapt to changing trends with launches such as its ‘Oat Up’ milk product. This took a period of under 12 months from conception to initial sales.

Wide Open Agriculture is seeking to penetrate the largest and fastest-growing food and beverage markets through its food technology programs. Research into lupin beans began in May 2020 with the company producing a lupin-based protein at pilot-scale in December.

Furthermore, Wide Open Agriculture revealed that more global food companies are partnering with plant-based businesses. In the United States alone, 9 out of 10 meat companies either launched, bought, or worked together with plant-based meat brands in 2019.

To validate claims that plant-based protein is the next big thing, conventional meat sales lifted 40% in year-to-year sales for the month of March 2020. In comparison, plant-based meat sales rocketed by 231% over the same time frame.

Market opportunity

A report published by PV Plant Milk indicated that the market for plant-based meat is expected to reach US$28 billion by 2025. This is more than double the current market of US$12.1 billion.

The global oat milk market was estimated to be worth around $3.7 billion in 2019, growing at a compound annual growth rate (CAGR) of 9.8%. This by far outpaced other milk alternatives such as hazelnut, coconut, almond, rice, hemp, and soy products.

About the Wide Open Agriculture share price

The Wide Open Agriculture share price has taken over in the past 12 months, gaining by nearly 530%. The company’s shares reached an all-time high of $1.85 in August 2020 before trending lower.

Based on the current share price, Wide Open Agriculture commands a market capitalisation of roughly $60 million.

More reading

• Future proofing: Should you invest in a sustainable ASX portfolio?

Motley Fool contributor Aaron Teboneras 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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The Bank of Queensland Limited (ASX: BOQ) share price is up 0.23% today to $8.85. One reason this may be happening is the regional bank signing a new lease with AMP Ltd (ASX: AMP) subsidiary AMP Capital.

AMP is not having such a hot day on the market. As of writing, the company’s share price is down 1.58% to sit at $1.44. 

For comparative purposes, the S&P/ASX 200 Index (ASX: XJO) is down 0.21%.

The deal

The Sydney Morning Herald (SMH) is reporting the bank has signed a 10-year lease to move its head office in Sydney to 255 George Street. The deal covers 4 floors and includes the building signage.

The building is already home to Bank of Queensland subsidiary Virgin Money Australia. The move will bring the two companies under one roof for the first time. It is currently undergoing a redevelopment.

AMP Capital head of real estate, Kylie O’Connor, said the agreement with the Bank of Queensland highlighted “the importance of workplace accommodation for collaboration.”

Bank of Queensland’s chief financial and chief operating officer Ewen Stafford told the SMH: “In selecting the right space to bring our multi-brand teams together in the one location, we wanted a building that provided a market-leading level of amenities to our people,”

He added: “As more of our people return to the workplace, and with the pandemic changing the way we do business, we’re looking forward to collaborating in new ways and our future home at 255 George Street will purposefully serve our future workplace needs and allow us to prosper.”

The high office building vacancy rate

SMH is reporting the national office vacancy rate is 11.7% – its highest level in 24 years. The Australian Financial Review (AFR) has the rate in the Sydney CBD at 8.6%. That’s up from 5.6% in the previous reporting period and the 3.9% rate recorded pre-COVID pandemic.

The premium-grade office vacancy rate rose to 6.2% while A-grade vacancy more than doubled to 9.7%.

To further compound the already suppressed office building market, approximately 110,000 new square metres of office were built in the Sydney CBD. Increasing supply and decreasing demand means lower rental rates.

AMP and Bank of Queensland share price snapshots

Just last week, the Bank of Queensland achieved its 52-week share price record of $9.44. The last time the bank broke its 1-year record was 1 week prior.

AMP’s 52-week record of $1.97 was last achieved in June 2020. Since then, the AMP share price has valleyed and troughed. AMP is currently in the process of selling most of its business.

The Bank of Queensland has a market capitalisation of $4.8 billion, while AMP’s is $4.9 billion.

More reading

• Demoted AMP exec paid $1m bonus for 53 days’ work
• AMP (ASX:AMP) share price on watch as second buyer for its asset could emerge
• ASX 200 sinks 2.4%, Afterpay plunges, AMP jumps
• ASX 200 down 2.3%: Afterpay & Kogan sold off, Orica smashed, AMP pushes higher
• Why AMP, Bubs, BWX, & Lynas shares are pushing higher

Motley Fool contributor Marc Sidarous 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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If you’re wanting to add some growth shares to your portfolio in March, then you might want to consider the ones listed below.

Here’s why they have been tipped as the shares to buy:

Nearmap Ltd (ASX: NEA)

Nearmap is an aerial imagery technology and location data company with operations in both the ANZ and North American markets. It provides businesses with instant access to high resolution aerial imagery, city-scale 3D datasets, and integrated geospatial tools.

Although it was targeted by a short seller earlier this year, the market doesn’t appear concerned by this report following a stronger than expected half year update in February. Not only did Nearmap outperform expectations, the part of the business that was heavily criticised by the short seller did the heavy lifting.

This went down well with analysts at Goldman Sachs. In response to its results, it put a buy rating and $2.95 price target on Nearmap’s shares.

It believes the headwinds Nearmap has been facing will ease in 2021, which should have a positive impact on demand. Looking further ahead, the broker believes the company’s balance sheet is strong enough to see it through to profitability in FY 2023.

Xero Limited (ASX: XRO)

Another ASX growth share that Goldman is a fan of is Xero. It is a provider of a cloud-based business and accounting solution to small and medium sized businesses around the world.

Despite the pressures that small businesses have been under during the pandemic, Xero has continued to perform strongly over the last 12 months.

In fact, it has even continued to add subscribers at an impressive rate. For example, at the end of the first half of FY 2021, Xero had grown its subscribers by 19% year on year to 2.45 million. This supported a 21% increase in half year operating revenue to NZ$409.8 million and a 15% lift in total subscriber lifetime value to NZ$6.2 billion.

Since then, the company has announced the acquisition of Planday for a total potential consideration of ~A$285 million.

Goldman Sachs believes this acquisition will provide it with a meaningful step into Europe. In addition, it expects it to help Xero build out its app ecosystem. This is a big positive as the broker believes that monetising its app ecosystem has the potential to be a key driver of growth in the future.

At present, Goldman Sachs has a buy rating and $157.00 price target on its shares. It believes Xero is capable of delivering strong revenue growth over multiple decades.

More reading

• Why Afterpay, Nearmap, Temple & Webster, & Z Energy are tumbling lower
• Could Australia be the next tech hub? Afterpay (ASX:APT) CEO thinks it should be
• Here are some of the best performing ASX tech shares today
• ASX 200 rises, Afterpay sinks, Vocus jumps
• Why ASX 200 tech shares could be in for another wild session

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 Nearmap Ltd. The Motley Fool Australia owns shares of Xero. The Motley Fool Australia has recommended Nearmap 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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On Wednesday I looked at three ASX shares that brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with them right now. Three ASX shares that have just been given sell ratings by brokers are listed below. Here’s why these brokers are bearish on them:

Galaxy Resources Limited (ASX: GXY)

According to a note out of Morgan Stanley, its analysts have retained their underweight rating and $1.50 price target on this lithium miner’s shares. This follows Galaxy’s announcement that it plans to push ahead with the basic engineering phase of its James Bay project in North America. The results of the Preliminary Economic Assessment were in line with what the broker was expecting. As such, no changes have been made to its recommendation at this point. It holds firm with its underweight rating for valuation reasons. The Galaxy share price is fetching $2.31 this afternoon.

Treasury Wine Estates Ltd (ASX: TWE)

Analysts at Citi have retained their sell rating and $9.30 price target on this wine company’s shares following its update on its Americas strategy. While the broker sees a lot of positives on its premiumisation strategy in the region, it isn’t enough for a change in its rating. Especially given how its restructuring still has long way to go. The Treasury Wine share price is trading at $11.49 on Thursday.

Zip Co Ltd (ASX: Z1P)

A note out of UBS reveals that its analysts have downgraded this buy now pay later provider’s shares to a sell rating with an improved price target of $6.40. According to the note, the broker was pleased with its strong growth during the first half. It also appears to believe more of the same is coming in the near term. However, it does have concerns by rising bond yields. This is due to the impact they could have on funding and its valuation. The Zip share price is fetching $8.42 on Thursday afternoon.

More reading

• The Zip (ASX:Z1P) share price just keeps on falling
• Is it ok to buy ASX 200 shares at a 52-week high?
• ASX 200 down 0.9%: Flight Centre & Webjet jump, Afterpay sinks
• Is Afterpay (ASX:APT)’s BNPL competition heating up?
• ASX 200 drops, Zip down, Afterpay soars

James Mickleboro owns shares of Galaxy Resources Limited. 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 Treasury Wine Estates 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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