Yesterday I had a look at a number of shares which had found favour with brokers and been given buy ratings this week.
Today I thought I would have a quick look at a few shares that haven't fared so well and have been given the dreaded sell rating. They are as follows:
Challenger Ltd (ASX: CGF)
According to a note out of Morgan Stanley, the broker has retained its underweight rating and placed an $11.50 price target on the annuities company ahead of earnings season. The broker appears to believe that Challenger is expensive for its growth profile and I would have to agree. While I think it is a great company, I would only buy in if its shares were trading at a much lower price.
Treasury Wine Estates Ltd (ASX: TWE)
Analysts at Citi have retained their sell rating and $10.90 price target on the wine company's shares following a review of its key markets. While demand from Asia is believed to be strong, Australian demand is thought to have declined, and US demand is predicted to have softened. As a result, Citi appears concerned that Chinese demand could be offset by weakness in other markets. However, signs of a recovery in the Americas market could change the broker's mind. While I think that Treasury Wine Estates is a quality growth share, I wouldn't be buying its shares so close to earnings season given the amount of growth that is priced in.
Western Areas Ltd (ASX: WSA)
A note out of CLSA reveals that its analysts have retained their sell rating on the leading nickel producer's shares. Furthermore, the broker has a target price of $2.60 for its shares, approximately 22% lower than the current share price. CLSA believes that Western Areas' current valuation incorporates a nickel price that is unstainable. Interestingly, Citi also slapped a sell rating on its shares this morning on valuation ground. Despite this, the nickel producer's shares climbed almost 5% higher today.
