Earnings season may be drawing ever closer but brokers have been as busy as ever this week making changes to their models and recommendations.
Three that have fared well and been given buy ratings are listed below. Here's why brokers like them:
Kogan.com Ltd (ASX: KGN)
According to a note out of UBS, it has retained its buy rating but reduced the price target on this ecommerce company's shares to $9.55 from $10.60 following yesterday's update. This price target implies potential upside of over 77% for its shares over the next 12 months. Although the broker has reduced its earnings estimates through to FY 2020 on the back of higher marketing costs and slightly lower revenue forecasts, it still believes Kogan is attractively priced. UBS expects Kogan to deliver EPS of 16 cents in FY 2018 before rising to 26 cents in FY 2019. This prices its shares at 21x estimated FY 2019 earnings, which I think is great value.
Pinnacle Investment Management Group Ltd (ASX: PNI)
A note out of Ord Minnett reveals that its analysts have upgraded this financial services company's shares to a buy rating from hold with an improved price target of $6.43. The broker made the move after Pinnacle completed its share placement to fund a $48 million investment in Metrics Credit Partners and Omega Global Investors. In addition to this, Ord Minnett appears happy to see that its FUMs were better than expected in FY 2018. While it isn't a company I know well, Ord Minnett appears to be on the money with this one.
Redbubble Ltd (ASX: RBL)
Analysts at Morgans have retained their add rating and lifted the price target on this ecommerce company's shares to $1.91 following the release of a trading update yesterday. According to the note, the broker is pleased with management guiding to 30% growth in revenue and EBITDA in FY 2019, It appears confident that Redbubble will deliver on this guidance. I agree with Morgans on this one and think it would be a great option for investors.
