Many of Australia’s leading brokers will be breathing a sigh of relief that we are now on the home straight of earnings season.
But while the end may be in sight, the results continue to come in thick and fast, which has led to the release of countless broker notes.
Three buy ratings that caught my eye are summarised below. Here’s why these shares are tipped as buys:
Kogan.com Ltd (ASX: KGN)
According to a note out of UBS, its analysts have retained their buy rating but reduced the price target on the ecommerce company’s shares to $8.65 following the release of its full-year results. UBS appears pleased that Kogan’s results were stronger than expected and ahead of its estimates. However, it is a little concerned over the absence of a trading update. I agree that this is a concern, especially given how last year the company provided a trading update with its results. Some investors may have interpreted this as a sign that Kogan has had a soft start to FY 2019. However, I would be surprised if momentum had suddenly been lost considering its strong end to the year, so I would agree that it remains a buy at these levels.
Link Administration Holdings Ltd (ASX: LNK)
A note out of the Macquarie equities desk reveals that its analysts have retained their outperform rating and lifted the price target on Link’s shares to $8.70. According to the note, the broker was pleased with Link’s outperformance of its estimates in FY 2018 and the performance and prospects of its Link Asset Services business. The broker expects its shares to trade more in line with its peers in the near future once the market begins to appreciate the growth opportunities for the Link Asset Services business. I’m not a big fan of Link but feel it could still be worth a look, especially after today’s heavy decline.
Telstra Corporation Ltd (ASX: TLS)
Analysts at Goldman Sachs have retained their conviction buy rating and $3.60 price target on Telstra’s shares following the release of earnings which the broker described as “high quality”. The broker has pointed to the accelerating subscriber momentum across each of Telstra’s key business lines as a highlight in FY 2018. Especially its postpaid mobile business which it estimates achieved 70% of net adds in the fourth quarter despite heightened competition. Goldman expects Telstra to declare a 17 cents per share dividend in FY 2019. I think that the broker makes some great points and could be onto something with the embattled telco giant. However, I’m not brave enough to invest just yet, but once it has updated the market on its dividend plans for FY 2019 I could be inclined to take a position at the right price.
Instead of Telstra I would be buying this number one dividend pick for FY 2019.
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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 Telstra Limited. The Motley Fool Australia has recommended Kogan.com ltd. 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.