Finding new investment ideas can be a daunting task. While some investors get their ideas by reading the newspapers or observing company updates on the ASX website, others refer to recent upgrades from brokers.

Of course, these recommendations do need to be taken with a grain of salt, and investors should always do their own due diligence before making a decision. But, checking out which shares the brokerage firms like can be a good starting point.

Here are 10 ASX shares that have recently been upgraded by the brokers:

Company Market Value** Closing Price (Thursday) Target Price Upside*
Aconex Limited (ASX: ACX) $1,587 billion $8.14 Morgan Stanley: $10 22.9%
Appen Ltd (ASX: APX) $301 million $3.10 Bell Potter: $2.80 -9.7%
BHP Billiton Limited (ASX: BHP) $108,205 million $20.34 Citi: $21 3.2%
Blackmores Limited (ASX: BKL) $2,558 million $148.50 Credit Suisse: $175 17.8%
BlueScope Steel Limited (ASX: BSL) $4,485 million $7.85 Macquarie: $8.50

UBS: $8.70

8.3% / 10.8%
Catapult Group International Ltd (ASX: CAT) $194 million $3.80 Morgans: $4.29 12.9%
EVOLUTION FPO (ASX: EVN) $4,302 million $2.93 Canaccord Genuity: $2.45 -16.4%
Fortescue Metals Group Limited (ASX: FMG) $13,140 million $4.22 UBS: $3.85

Macquarie: $4.10

-8.8% / -2.8%
Primary Health Care Limited (ASX: PRY) $1,966 million $3.77 Citi: $3.71 -1.6%
Sirtex Medical Limited (ASX: SRX) $1,663 million $29.04 UBS: $44 51.5%

*Note: Again, the upside is simply a measure of how much the shares could appreciate (or depreciate), assuming that they do reach the broker’s target price.

**Figures according to S&P Global Market Intelligence

Which companies I would avoid

Of course, not every broker upgrade is a buy. The miners, for instance, have an improved outlook due to rebounding commodity prices, but with the risk of a sharp reversal in commodity prices they may not be worth the risk.

Evolution Mining is another example. The gold miner has skyrocketed in 2016 thanks to heightened uncertainty and a soaring gold price, but investors do need to ask how much further it can climb. It appears to be a quality business, but no business is a buy at just any price.

Which companies I’d buy

From the companies mentioned above, I would be most inclined to buy shares of Blackmores, Sirtex, Catapult Group or Appen, but none of them are without risk.

Catapult Group is a great business and this has largely been reflected by the incredible rally in its share price over the last year. The only reason I haven’t bought, however, is because of its valuation. That doesn’t mean the shares won’t go any higher, but it is something investors should keep in mind.

Appen is in a similar boat, although it does appear to have more growth ahead of it as well.

Much of Sirtex’s risk lies in the fact that it operates in the biotechnology industry and relies so heavily on one key product. In saying that, it is growing sales at a very decent clip which, if sustained over the next few years, could make today’s share price look very reasonable.

Finally, Blackmores shares aren’t cheap, either, and there are regulatory concerns in China. However, the company should be well equipped to cope in a tougher regulatory environment and, with sales and earnings both skyrocketing, it is certainly worthy of a closer look by investors.

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Motley Fool contributor Ryan Newman has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.