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3 hot tips from 3 top brokers

Many investors seek out advice from brokers and analysts to determine their next market moves.

Here are 3 hot stock tips from 3 top brokers.

Macquarie Telecom Group Ltd. (ASX: MAQ)

Shares in telecommunication and hosting company Macquarie Telecom Group Ltd have risen 38% from this time last year and are sitting not far off 52-week highs of $20.34 reached earlier this month.

But according to Canaccord Genuity, this stock is still a buy.

The broker has placed a $22.30 price target on Macquarie Telecom, with a “sunny outlook” expected when FY18 results flow in on August 30.

According to the broker, results should comfortably beat expectations despite being weighed down by costs associated with its failed bid for cloud services provider Bulletproof Group (ASX: BPF) back in May.

Canaccord estimate FY18 EBITDA will be the top end of guidance with Macquarie Telecom only starting to net the rewards of insourcing its network operations centre – the full benefits of which should come to fruition in FY19.

Macquarie Telecom’s wholesale agreement with nbnCo has the potential to be a significant development for the business with the new agreement opening up regional opportunities.

While Macquarie Telecom shares have enjoyed a good run upwards in the last year Canaccord doesn’t think its too late to buy in, calling the shares “modestly valued” and trading on an FY19 EV/EBITDA multiple of 8.4v.

Integrated Research Limited (ASX: IRI)

Wilsons Wealth Management has placed a sell rating on business systems company Integrated Research off the back of FY18 profit guidance released last week, signalling flat revenue, minimal NPAT growth and underperforming European operations.

Wilsons sell recommendation comes after soft trading across the IT infrastructure segment with concerns surrounding Integrated Research’s cash flow, the cloud technology threat and revenue growth coming in 6% below the broker’s expectation.

Wilsons has a $2.65 price target on the stock, which closed July 16 at $2.45.

Integrated Research said while its FY18 profit guidance was “disappointing” it believed the “fundamentals of the business remain sound” with stronger license growth anticipated for the new financial year.

At June 30 the company had $11.2 million in cash holdings and zero debt.

Jumbo Interactive Ltd (ASX: JIN)

Morgans has upgraded its rating on internet lottery business Jumbo Interactive from hold to add, with a price target of $4.84 on the stock, which closed July 16 trade at $4.55.

Morgans thinks given the fact Tabcorp Holdings Limited (ASX: TAH) recently exercised 3.5 million options and reduced its exposure to Jumbo to 12.5% is the key to current share price weakness, which could create opportunities with its PE of 14.2x FY19 “attractive”.

Following the exercise of options, Tabcorp sold about 2.85 million Jumbo shares to institutional investors for $4.26 per share which caused a drop in Jumbo’s share price that could have caused some investor concern.

But Morgans says while it still sees Jumbo as a good fit for Tabcorp down the track, it hasn’t built any takeover premium into the price target, with the fall in Jumbo’s share price providing an in for investors as lottery sales both online and offline improve in Australia.

Jumbo has been actively pursuing opportunities for growth in the US, Latin America, Asia and Europe with its current operations in Australia and Germany also in expansion phases.

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Motley Fool contributor Carin Pickworth has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Integrated Research 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.