On Thursday I took a quick look at a number of shares that had found favour with brokers and been given buy ratings.
Today I thought I would look at the shares that haven't impressed brokers this earnings season and have subsequently been given sell ratings.
Here are three:
Coca-Cola Amatil Ltd (ASX: CCL)
According to a research note out of Morgan Stanley, its analysts have retained their underweight rating and $8.00 price target on the beverage company's shares. Although Coca-Cola Amatil's shares are cheap, they believe they are cheap for a reason and have concerns that the company may fall short of its full-year guidance. Whilst I wasn't blown away by its results this week, I feel the company has a significant runway for long-term growth in Indonesia that could make it worth holding onto.
Insurance Australia Group Ltd (ASX: IAG)
A note out of Citi reveals that its analysts have retained their sell rating and $6.30 price target on the insurer's shares. A miss on cash earnings due largely to margin pressures appears to have disappointed the investment bank. I thought that Insurance Australia's full-year result was weak and can't say I'm surprised to have seen its shares sink since. Overall I feel there are better options in the industry right now.
Worleyparsons Limited (ASX: WOR)
Analysts at Credit Suisse have downgraded the mining services company's shares to an underperform rating with a $9.50 price target. According to the note, Credit Suisse believes that although things appear to be improving in the sector, Worleyparsons' current valuation is difficult to justify. Based on the current share price Credit Suisse's price target implies downside risk of approximately 27%. I completely agree with Credit Suisse on this one. At approximately 26x underlying earnings Worleyparsons looks vastly overvalued.
