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Leading brokers name 3 ASX shares to buy today

Brokers up and down Australia have been busy once again adjusting discounted cash flow models and valuations accordingly as new data becomes available.

Three top shares that have come out of this favourably are listed below. Here’s why brokers are tipping them as buys:

Domino’s Pizza Enterprises Ltd (ASX: DMP)

According to a note out of Morgans, its analysts have upgraded Domino’s to an add rating from hold with an improved price target of $51.51. Although the broker isn’t convinced that the pizza chain operator will hit its profit growth guidance in FY 2018, it doesn’t believe it will miss by much. Furthermore, Morgans thinks the company will be able to average profit growth of approximately 15% per annum for the next three to five years. I agree with Morgans that Domino’s is a buy right now and believe it is well worth investing with a long-term view.

Fortescue Metals Group Limited (ASX: FMG)

Analysts at Credit Suisse have retained their outperform rating and $5.75 price target on this iron ore producer’s shares after it approved the development of the Eliwana project in Western Australia. The broker appears pleased to see that this will introduce a 60% iron grade product (Fortescue Premium) in the second half of FY 2019. I think the development of Eliwana is a great move by management and should offer some support to the company’s financial performance if the discount between high grade and low grade iron ore doesn’t narrow in the medium term.

Wesfarmers Ltd (ASX: WES)

A note out of Credit Suisse reveals that its analysts have retained their outperform rating and lifted the price target on the conglomerate’s shares to $47.36 after it divested its Bunnings UK and Ireland business. The broker believes the deal it struck with Hilco Capital is better than expected and appears pleased that Wesfarmers will retain a 20% share of any future equity distribution from the Homebase business. While I agree that this is probably a better result than many expected, it has still been a disappointing waste of shareholder value. I intend to hold off an investment and wait to see what the company’s next move is.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Wesfarmers Limited. The Motley Fool Australia has recommended Domino's Pizza Enterprises Limited. 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 Scott Phillips.