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:

BWP Trust (ASX: BWP)

According to a note out of UBS, its analysts have retained their sell rating and $3.86 price target on this Bunnings landlord’s shares. This follows the release of a half year result earlier this week that was a little softer than it was expecting. In addition to this, it has issues with its valuation and believes the market isn’t pricing in the risks it is facing. The BWP share price is currently fetching $4.11 on Thursday afternoon.

Platinum Asset Management Ltd (ASX: PTM)

A note out of Morgan Stanley reveals that its analysts have retained their underweight rating but lifted the price target on this fund manager’s shares to $3.20. According to the note, the broker believes that Platinum’s shares are overvalued considering the fund outflows it is experiencing. In December, the company experienced net outflows of approximately $149 million despite an improving performance. The Platinum share price is trading at $4.36.

Virgin Money UK CDI (ASX: VUK)

Analysts at Morgans have retained their reduce rating but lifted the price target on this UK based bank’s shares to $2.36 following its first quarter update. According to the note, the broker was pleased to see the company report low impairment charges during the quarter and reaffirm its guidance for FY 2021. Nevertheless, Morgans holds firm with its reduce rating and sees more value in some of the Australian banks. The Virgin Money UK share price is trading at $2.69 this afternoon.

More reading

• Why AGL, Bubs, BWP, & Origin shares are dropping lower
• ASX 200 up 0.9%, Afterpay drops, CBA rises
• Why the Virgin Money UK (ASX:VUK) share price is surging 13% higher
• ASX 200 up 1.1%: Amcor jumps, South32 sinks, Virgin Money UK rockets
• Here’s why the BWP (ASX:BWP) share price is heading higher today

Motley Fool contributor James Mickleboro 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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Brokers are constantly looking at the ASX share market, deciding which businesses look like promising ideas and which ones look expensive.

The below ASX shares have been rated as buys by at least three brokers:

City Chic Collective Ltd (ASX: CCX)

City Chic is a retail business which specialises in plus-size apparel, footwear and accessories for women.

It’s currently liked by at least three brokers.

It operates a variety of different brands. It owns City Chic, Avenue, CCX, Hips & Curves, Fox & Royal. It has a network of almost 100 stores across Australia and New Zealand. It also has websites operating in Australia, New Zealand and the US. On top of that, it has marketplace and wholesale partnerships with big retailers in the US like Macys and Nordstrom, and a wholesale business with European and UK partners such as ASOS and Zalando.

Avenue targets value-conscious women with a long history and significant online customer following in the US. Hips & Curves and Fox & Royal are online intimates brands in the US and ANZ respectively.

One of the main reasons why brokers such as Morgan Stanley like the ASX share is that the retail apparel sector is doing well, as seen with updates from other apparel companies.

Morgan Stanley likes the balance sheet strength of the business, which could fund other acquisitions. City Chic recently announced the acquisition of Evans in the UK.

Reject Shop Ltd (ASX: TRS)

Reject Shop is a discount retailer in Australia. It’s currently liked by at least three brokers.

The ASX share is currently going through the process of trying to lower its cost base. Morgan Stanley pointed out that Reject Shop’s management said at the AGM that the strategy is going according to plan.

Reject Shop could be a beneficiary from customers spending more time at home, it’s also working on providing a smaller number of different products so that there’s more product availability of the remaining items for customers and so that it has better buying power with suppliers.

One of the other ways that Reject Shop is looking to improve margins is by renegotiating many of its leases with landlords.

Once the company’s cost base is set at a sustainable level, it’s expected to pursue longer-term growth through store network expansion and e-commerce.

However, there have been delays at Australian ports which is affecting stock availability and increased costs through higher shopping charges.

Bapcor Ltd (ASX: BAP)

Bapcor claims to be the largest auto parts business in Australasia.

This ASX share is currently liked by at least six brokers.

The company is seeing elevated levels of demand during these strange times.

Trade and wholesale represent over 80% of Bapcor’s business, with retail representing around 20%. Management said that trade focussed businesses perform solidly in difficult economy conditions, which is being demonstrated by the current levels of performance.

Bapcor said that retail businesses continue to gain momentum with revenue up 40% over the prior corresponding period in the first half of FY21. The company has implemented a number of initiatives to help growth. That includes a new Autobarn store format which is delivering a significant uplift in sales. It has also improved its e-commerce capabilities and continued to open new locations.

One of the other things that Bapcor is doing to improve profit margins is that it’s building a new distribution centre for Victoria. The automated picking system is expected to be operational by August 2021. Management believe this will offer significant operational benefits.

In the first half of FY21, Bapcor is expecting profit growth of at least 50%.

More reading

• Got money to invest for dividends? Here are 3 ASX shares
• 2 little known ASX growth shares to buy
• Why this fund likes these 3 ASX shares
• 2 ASX dividend shares rated as strong buys by brokers
• The ASX small cap with the best global expansion potential may not be tech

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bapcor. 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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ASX growth investing is a trend that has rapidly grown in popularity over the past few years. From the rise of the WAAAX shares to the rise of buy now, pay later (BNPL) companies, there has certainly been a lot going in in this space.

But of the countless companies trying to occupy this space, which are the best shares to invest in for 2021 and beyond? Here are 2 to consider today:

2 ASX growth shares

Afterpay Ltd (ASX: APT)

Afterpay, we’re here again. This BNPL pioneer is never far from the spotlight. Last year, Afterpay sensationally cratered during the coronavirus-induced market crash, falling to a multi-year low of $8.01 a share. But since then, this company has managed to engineer a stunning recovery.

Just last month, Afterpay yet again set a new all-time high share price of $151.22. Even on today’s share price of $147.02 (at the time of writing), this company is up more than 1,500% from those lows.

Although this share price looks expensive from that perspective, there’s a reason investors’ can’t get enough of this company. It has been growing at breakneck speed too.

In its annual report for FY2020, the company announced a 112% increase in underlying sales to $11.1 billion and a 73% rise in earnings before interest, tax, depreciation and amortisation (EBITDA). Afterpay has always been a company that has looked expensive. But remember, that perception has not paid off for anyone in the past 5 years.

Bigtincan Holdings Ltd (ASX: BTH)

Bigtincan is another ASX growth share to look at today. This company provides a Software-as-a-Service (SaaS) business model which provides businesses with access to Bigtincan’s Hub platform.

Bigtincan Hub works as a ‘sale enablement’ service and allows business clients to use tools like document editing, cloud storage and video conferencing. It essentially helps businesses function more efficiently, and hone their marketing strategies. It has also been expanding rapidly, especially in the past year. The acquisitions of VoiceVibes and ClearSlide have the potential to add a lot of functionality to Bigtincan Hub, and allow the company to expand into areas where it previously had little presence.

On top of that, Bigtincan is a company that is already growing fast organically. In its recently-announced quarterly update, Bigtincan told investors that recurring revenues had grown by an astonishing 50% over the prior corresponding quarter. Its recent capital raising has also left the company with plenty of cash in the bank for future expansion.

More reading

• Leading broker tips 3 ASX shares to positively surprise during earnings season
• 2 explosive ASX growth shares to buy immediately
• ASX 200 up 0.9%, Afterpay drops, CBA rises
• 2 ASX shares that humbled successful fundies
• Why the Afterpay (ASX:APT) share price is pushing higher again

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends BIGTINCAN FPO. The Motley Fool Australia owns shares of and has recommended BIGTINCAN FPO. The Motley Fool Australia owns shares of 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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The Peel Mining Ltd (ASX: PEX) share price shot 11% higher today on the back of a market update about the miner’s Wirlong site. Peel shares are swapping hands for 25 cents apiece at the time of writing.

Peel Mining is a western New South Wales mineral explorer. The company is focused on developing large-scale and high-grade base metal deposits in the Cobar Superbasin.

Peel Mining holds an approximate 27% shareholding in Saturn Metals Ltd (ASX: STN), a junior gold exploration company that has built a portfolio of assets in the Western Australian Goldfields region.

Peel Mining share price soars upon copper announcement

Prior to the Peel Mining share price shooting up, the company reported very strong copper mineralised intercepts at its 100% owned Wirlong deposit.

In today’s announcement, Peel highlighted the mineralisation discovered is consistent with and supports the company’s geophysical and geological modelling. The modelling involves the application of an electromagnetic conductor plate and a revised structural model.

Peel Mining managing director Rob Tyson commented:

These drillholes continue to demonstrate very high copper tenors, akin to those seen in previous drilling. The results highlight Peel’s opinion of the potential of Wirlong as we push towards a maiden mineral resource and emphasise our desire to become Cobar’s next copper-dominant base and precious metals mining Company.

A summary of Peel Mining’s Wirlong project

The Wirlong Copper discovery is located approximately 70km south-southeast of Cobar. Mineralisation at Wirlong has been defined from near-surface to a depth of more than 600 metres below surface.

As mentioned by Tyson, the company has initiated efforts to establish a copper-rich maiden mineral resource at Wirlong. The resource definition program for this project consists of approximately 11,000 metres of drilling and is anticipated to be completed in the June quarter of 2021.

The next steps for the maiden resource are preliminary metallurgical testwork, ore sorting trials, along with resource modelling and estimation and a scoping study.

The Peel Mining share price has fallen 6.25% over the past six months. On current prices, the company has a market capitalisation of $80.3 million.

More reading

• Goldman Sachs names 2 growing ASX dividend shares to buy
• Why is the Origin (ASX:ORG) share price tanking today?
• Why the Adveritas (ASX:AV1) share price is rising 5% higher
• Here’s why the Qantas (ASX:QAN) share price is soaring today
• Amazon introduces new electric delivery trucks in Los Angeles

Motley Fool contributor Gretchen Kennedy 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 an income investor on the lookout for dividends that could grow strongly in the future, then you might want to take a look at the shares listed below.

Here’s why they could be worth considering:

Bravura Solutions Ltd (ASX: BVS)

Bravura Solutions is the financial technology company behind the Sonata wealth management platform. This popular platform allows financial advisers to connect and engage with clients via computers or smart devices.

In addition to this, the company has been bolstering its offering with a number of key acquisitions in recent years. This includes the addition of FinoCamp, Midwinter, and Delta Financial Systems.

FinoCamp builds unique and highly flexible software that supports the UK wealth market, Midwinter is a financial planning software provider, and Delta Financial Systems provides technology to power complex pensions administration in the UK market.

FY 2021 looks set to be a very challenging year because of the pandemic and Brexit. However, analysts at Goldman Sachs think investors should look beyond this short term weakness and focus on its strong long term growth potential.

The broker currently has a buy rating and $4.50 price target on its shares. It is also forecasting dividends of ~10.6 cents per share, ~12.4 cents per share, and ~14.4 cents per share over the next three years. This represents yields of 3.5%, 4.1%, and 4.7%, respectively.

Coles Group Ltd (ASX: COL)

This supermarket giant is another ASX share which has been tipped to grow its dividend at a solid rate in the coming years.

This is thanks to its defensive qualities, focus on automation, cost cutting, and growing own brand sales.

Goldman Sachs is also very positive on Coles and currently has a buy rating and $21.10 price target on its shares.

The broker is forecasting dividends of 64 cents per share, 68 cents per share, and 76 cents per share over the next three years. Based on the current Coles share price of $18.30, this represents fully franked yields of 3.5%, 3.7%, and 4.15%, respectively.

More reading

• 4 most trusted ASX companies (and the 4 least trusted)
• 2 of the best ASX dividend shares to buy today
• Got cash to invest? Here are 3 ASX shares to buy
• Top ASX shares to buy in February 2021
• ASX 200 Weekly Wrap: Reality (and GameStop) finally hits ASX

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bravura Solutions Ltd. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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 Origin Energy Ltd (ASX: ORG) share price is down by 7.06% to $4.61 at the time of writing.

The downward spiral was set off by the release of Origin’s revised operating conditions and guidance for FY2021.

Here’s a few things we learned from the announcement.

Origin expects gross profits to be down

Origin expects FY2021 electricity gross profit to be down $250–290 million year-over-year. The previous guidance predicted a $170–220 million reduction.

The company puts this loss to lower wholesale prices, payment of a non-recoverable $40 million increase in network costs and the impact of mild summer conditions.

The natural gas gross profit is also expected to be down $200–250 million year-over-year. This has been raised from the original $100–150 million estimate.

Origin advised that the decline of the natural gas gross profit was influenced by lower sales and the roll off of legacy sales contracts that totalled $70 million.

The company believes that improved LPG and community energy services will partially offset electricity and gas gross profit losses.

Origin share price slides in tough operating environment

In addition to revised guidance, the company also commented on the current business environment.

Origin lists the influences of the coronavirus and weather patterns brought by La Niña as having had a material effect on the business.

The company expects the presently challenging operating conditions of energy markets to persist in FY2022.

Origin downgraded its underlying earnings (including electricity and gas) to the $1–1.14 billion range. Its initial guidance estimated between $1.15–1.3 billion.

Commenting on Origin’s position, CEO Frank Calabria said:

Origin has two leading businesses with high quality assets and resources. We remain very focused on maximising value from the existing businesses and pursuing growth in customer value and low carbon solutions, which puts Origin in an ideal position to lead, and capture value, from the energy transition.

Regardless of the downgrades, Origin believes that its retail business is still on track to meet its $100 million FY2021 cost out target. The company stated that operations are performing well with strong cash flow generation.

The Origin share price has lost over 37% during the last 12 months.

More reading

• Why AGL, Bubs, BWP, & Origin shares are dropping lower
• ASX 200 down 0.7%: AGL & Origin sink lower, Qantas pushes higher
• Here’s why the Origin Energy (ASX:ORG) share price is climbing today
• These ASX energy stocks just got zapped by a broker downgrade
• Why ASX energy shares are under pressure right now

Motley Fool contributor Gretchen Kennedy owns shares of Origin Energy Limited. 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 Adveritas Ltd (ASX: AV1) share price is on the rise today after announcing its first contract with a European customer.

Based in Perth and Singapore, Adveritas is a fraud prevention software services company that specialises in digital advertising. The business services customers world-wide through its flagship software product, TrafficGuard.

During the opening minutes of trade, the Adveritas share price reached an intraday high of 18.5 cents, However, some slight profit taking have led its shares to retrace to 18 cents, up 5.9%.

What did Adveritas announce?

In today’s release, the company reported it has signed a commercial agreement with Deezer, a French online music streaming service.

Developed in Paris, Deezer allows its users to listen to music content from record labels. The company has over 56 million licenced tracks in its music library and 100 million playlists. In addition, Deezer boasts a member base of 16 million active users spanning over 180 countries.

Deezer is also the exclusive global music partner of smart technology wearable and fitness company, Fitbit.

Terms of the deals

Under the agreement, Adveritas will supply Deezer with TrafficGuard’s mobile app install anti-fraud solution. The Software-as-a-Service (SaaS) product detects and prevents real-time ad fraud. This keeps incoming traffic clean, increases reach, and drives return on ad spend.

For access to the service, Deezer will pay Adveritas a monthly base fee of 4,000 euros for a minimum 6-month period. The contract is extendable outside Deezer’s mobile segment, in which Adveritas is currently running trials into web and social spend.

The contract follows a raft of recently signed smaller deals which is expected to contribute to Adveritas annualised revenue. It noted that since the beginning of the calendar year, combined additional revenue stands at roughly $100,000.

Words from the CEO

Adveritas CEO Mat Ratty, touched on the company’s flagship software product, saying:

The rise of sophisticated fraud that installs apps, wasting companies’ advertising spend and causing misallocation of marketing budgets, makes tools like TrafficGuard more important than ever before.

With a number of global companies running trials with TrafficGuard, a few in contract negotiations, and a substantial increase in qualified leads across multiple industry verticals and regions over the past few weeks, we are well positioned to build on recent momentum.

About the Adveritas share price

Over the past 12 months, the Adveritas share price is down almost 20%. The company’s shares dive down to a 52-week low of 6.5 cents in March, before see-sawing for most of the year.

At the start of November, its shares rapidly shot up after reporting a surprise positive quarterly report. Since then, the Adveritas share price has stabilised around the late teens mark.

More reading

• Why is the Origin (ASX:ORG) share price tanking today?
• Here’s why the Qantas (ASX:QAN) share price is soaring today
• Amazon introduces new electric delivery trucks in Los Angeles
• Top brokers just upgraded these 3 ASX shares to “buy”
• Fossil fuels vs renewables: What’s ahead for ASX energy shares?

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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It has been a positive day for the Qantas Airways Limited (ASX: QAN) share price on Thursday.

At one stage today, the airline operator’s shares were up over 3% to $4.85.

The Qantas share price has since pulled back a touch but remains up 1.5% to $4.77 at the time of writing.

Why is the Qantas share price pushing higher?

Investors have been buying Qantas shares on Thursday after it announced a wet lease agreement with Alliance Aviation Services Ltd (ASX: AQZ) that will see the latter provide up to 14 E190 aircraft to Australia’s flag carrier airline.

A wet lease agreement is one where the lessor provides an entire aircraft and at least one crew member.

Alliance will initially provide Qantas with three E190 aircraft to commence operations in mid-2021. Qantas then has the option to call on an additional eleven aircraft based on market conditions.

According to the release, Qantas has made the move in order to meet an expected surge in local tourism demand once the country moves beyond sudden COVID-related border closures.

The Embraer E190 aircraft is a 94-seat jet with a five-hour range. Qantas believes this makes it well suited to linking regional centres with smaller capital cities. Judging by the Qantas share price reaction today, the market appears to agree.

What are the routes?

The initial routes that Alliance will fly for Qantas are expected to include Adelaide–Alice Springs, Darwin–Alice Springs, and Darwin–Adelaide.

The Boeing 737s that are currently used on these routes will be redeployed elsewhere in Australia. This is part of an ongoing ‘right aircraft, right route’ approach to the Qantas network.

QantasLink CEO, John Gissing, spoke very positively about the agreement. He feels it reflects the kind of flexibility Qantas needs to respond to opportunities without committing any capital.

He said: “We know this current climate of snap border closures will pass and we want to be ready for the recovery and for what is a structurally different market to what we had pre-COVID. The ability to switch on extra capacity with Alliance will help us make the most of opportunities in a highly competitive environment and having the right aircraft on the right route helps us deliver the schedule and network that customers want.”

Better economics

Mr Gissing notes that the E190 jets are perfectly suited to the routes that it is going to be flying.

He explained: “The E190 is a perfect mid-size regional jet for routes like these ones in northern Australia. It has longer range than our 717s and it’s about half the size of our 737s, which means the economics work well on longer flights between cities and towns outside of the top five population centres.”

“Instead of one or two flights a day with a larger aircraft, we can offer three or four flights a day on the E190, which gives customers in these cities a lot more choice about when they travel,” he added.

The agreement is also good news for Qantas international pilots and cabin crew that have been left without work because of COVID-19.

Mr Gissing commented: “Importantly, Alliance is keen to provide the opportunity for our international pilots and cabin crew to operate the E190s given it will be some time before overseas markets fully recover.”

Where next for the Qantas share price?

Although the Qantas share price has recovered strongly from its COVID-low, analysts at Goldman Sachs still see plenty of upside.

According to a note from 29 January, Goldman has a buy rating and $7.05 price target on its shares. Based on the current Qantas share price, this implies potential upside of almost 48% over the next 12 months.

More reading

• ASX 200 down 0.7%: AGL & Origin sink lower, Qantas pushes higher
• Why Alliance Aviation, REA Group, SEEK, & Vulcan shares are charging higher
• 4 most trusted ASX companies (and the 4 least trusted)
• Alliance Aviation (ASX:AQZ) share price surges 13% higher on Qantas (ASX:QAN) deal
• The latest ASX stocks to be hit by broker downgrades

Motley Fool contributor James Mickleboro 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon.com, Inc (NASDAQ: AMZN) announced yesterday that it has started using electric vehicles (EVs) for deliveries in the Los Angeles area after four months of testing. The delivery trucks are made by EV start-up Rivian. 

Amazon led a $700 million investment round in Rivian in 2019 as part of the Climate Pledge agreement it co-founded. The agreement commits to achieving net-zero carbon emissions by 2040, 10 years earlier than the Paris Accord’s plan. Amazon ordered 100,000 electric delivery vans from Rivian to help achieve that goal, and plans to have 10,000 of the vehicles in service in 2022, with all 100,000 by 2030. 

Amazon said it will have its new custom EVs operating in 15 additional cities this year. “This is one of the fastest modern commercial electrification programs, and we’re incredibly proud of that,” sad Ross Rachey, director of Amazon’s global fleet and products. 

The new vehicles have a range of 150 miles on a single charge. Amazon said it has also begun installing thousands of charging stations at its delivery hubs across North America and Europe. In order to meet its commitment, the company said in its news blog, it is also “exploring new technologies, alternative fuels, and delivery methods that deliver packages to customers in a more sustainable way”.

In addition to the specialty vehicles for Amazon, Rivian plans to manufacture electric pickup trucks and SUV “adventure vehicles” specialising in off-road conditions. The company has raised $8 billion since the start of 2019 to fund its development.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• 4 most trusted ASX companies (and the 4 least trusted)
• GameStop (NYSE:GME) appoints 3 new Vice Presidents from Amazon and Chewy
• Amazon (NASDAQ: AMZN) shares rise despite Bezos resignation
• Jeff Bezos quits as Amazon CEO
• GameStop (NYSE:GME) dominates the US shares ASX investors have been buying

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Howard Smith owns shares of Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Amazon. 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The market is losing ground today but some ASX shares are bucking the downtrend after brokers upgraded their ratings to “buy”.

The S&P/ASX 200 Index (Index:^AXJO) slumped 0.7% during lunch time trade with just about every sector losing ground.

However, the CSR Limited (ASX: CSR) share price is defying the gloom to jump 2.9% to $5.76 – a more than 10-year high.

Building to an ASX share “buy” upgrade

The positive outlook for residential construction is one driver for its outperformance. But an upgrade by Macquarie Group Ltd (ASX: MQG) is also probably helping.

“While the recovery from COVID-19 in health terms may well come in fits and starts, the earnings cycle for stocks seems well supported in the near term,” said the broker.

“Longer-term concerns around the lack of migration and its impacts on sustainability are likely less pertinent to the investment thesis, especially in 1HCY21.”

Macquarie lifted its earnings per share (EPS) forecasts for the sector to above consensus, and it believes the upgrade cycle has not yet run its course.

The broker changed its recommendation on the CSR share price to “outperform” from “neutral” with a price target of $6 a share.

Earnings remodeling

But CSR isn’t the only ASX stock that is leveraged to the positive housing activity outlook. The big jump in renovations prompted Macquarie to also upgrade the GWA Group Ltd (ASX: GWA) share price “outperform” from “neutral”.

Shares in the household fittings group surged 3.6% to $3.62 at the time of writing.

The broker noted that alterations and additions (A&A) approvals increased by 29% in the December 2020 quarter compared to the same period in 2019.

This is probably thanks to the federal government’s HomeBuilder grant. A&A accounts for more than 60% of GWA’s revenue.

Building approvals for detached housing also increased by an eye-watering 42% in the quarter compared to 4QCY19.

A&A and detached activity are expected to remain elevated for a while yet. The broker’s 12-month price target on the GWA share price is $3.90 a share.

Attractive package

Finally, the Amcor CDI (ASX: AMC) share price got upgraded by UBS to “buy” from “neutral” following its first half profit result.

Shares in the packaging company fell 3.4% to $14.52 at the time of writing, but the AMC share price jumped 4.5% yesterday on the earnings news.

Amcor posted results that were ahead of the market’s and UBS’ expectations, thanks largely to organic growth and its Bemis acquisition. Management also upgraded its FY21 guidance to above consensus.

“We are attracted to Amcor’s leading position across key global consumer packaging markets,” said UBS.

“The defensive nature of these markets is clearly supporting Amcor’s earnings base and cash flows despite COVID-19 related uncertainty.

“We think this earnings resiliency and growth outlook, combined with a solid dividend yield of c.4% should support the stock.”

UBS’ 12-month price target on the AMC share price is $16.60 a share.  

More reading

• ASX 200 down 0.7%: AGL & Origin sink lower, Qantas pushes higher
• Commonwealth Bank (ASX:CBA) tipped to increase dividend by 50% next week
• Pinnacle (ASX:PNI) share price will be on watch today
• 2 great ETFs to buy for growth potential
• 5 things to watch on the ASX 200 on Thursday

Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Amcor 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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