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Top brokers name 3 ASX shares to sell

On Thursday I looked at a few shares that had been given buy ratings by brokers this week.

Today I thought I would round off the week with a look at a few notable broker sells.

Three that caught my eye are listed below:

Domino’s Pizza Enterprises Ltd (ASX: DMP)

According to a note out of Citi, its analysts have downgraded this pizza chain operator’s shares to a sell rating from neutral. The broker has, however, lifted the price target on its shares slightly to $46.30. Citi has made the move after a decent share price rise and its belief that Domino’s Japan business could act as a drag on its results. Since the release of the note its shares have tumbled notably lower. I think this has presented investors with a buying opportunity if they are prepared to make a patient buy and hold investment.

Domain Holdings Australia Ltd (ASX: DHG)

Analysts at Morgans have retained their reduce rating and $2.66 price target on this property listings company’s shares. Although the broker believes the recent appointment of former Google ANZ managing director, Jason Pellegrino, could result in improvements to innovation and product development, it is not enough to warrant a change in rating just yet. I would agree with Morgans on this one, largely on valuation grounds. At 35x estimated full-year earnings, I think Domain is a little on the expensive side and doesn’t offer a good enough risk/reward.

Virgin Australia Holdings Ltd (ASX: VAH)

A note out of Goldman Sachs reveals that its analysts have retained their sell rating and 21 cents price target on this airline’s shares. While the broker is reasonably upbeat on the sector due to rising passenger numbers in April, it sees little value in Virgin Australia shares unless fuel prices lower and competition lessens. Instead, Goldman thinks investors ought to gain exposure to the industry through rival Qantas Airways Limited (ASX: QAN), which it has a buy rating and $7.25 price target on. I would agree with Goldman on both these recommendations.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. 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.

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