Deciding which shares to buy and which to avoid is one of the toughest decisions that investors have to make. Thankfully there are brokers out there trying to make life easier for investors by providing their own recommendations.
On Monday there were three recommendations in particular that caught my eye. Here they are:
Autosports Group Ltd (ASX: ASG)
Autosports is a prestige and luxury motor vehicle retailer with eight new and two used dealerships across Sydney, Melbourne and Brisbane. A research note out of Macquarie yesterday revealed that its analysts have started coverage on the company with an outperform rating. As I explained a couple of weeks ago, this newly-listed company has forecast pro forma net profit growth of 39% in FY 2017. Based on this its shares are changing hands at just 19x forward earnings, which I believe is great value considering the growth it is exhibiting.
Bendigo and Adelaide Bank Ltd (ASX: BEN)
In the last six months the shares of this regional bank have risen a remarkable 26%, making it by far the best-performing banking share on the ASX during the period. Unfortunately though analysts at Citibank think the run is coming to an end. A research note out of the investment bank reveals that it has downgraded Bendigo and Adelaide Bank from a buy rating to a sell. Whilst I wouldn't be in a rush to sell its shares, I certainly wouldn't be a buyer at current prices. I would wait for a reasonable pull back in all bank shares, before considering an investment.
Cimic Group Ltd (ASX: CIM)
Analysts at Deutsche Bank have slapped a sell rating on this construction company according to a research note. I would have to agree with Deutsche on this one. Whilst the company's recent takeover of UGL Limited is likely to be a boost to earnings moving forward, I still think its shares are overly expensive at 20x estimated FY 2017's earnings according to CommSec. Furthermore, its former CFO Peter Gregg is due in court soon over allegations that he falsified the books during his time at the company. I'm concerned that this court case could weigh heavily on its shares. This is one to avoid in my opinion.
