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Leading brokers name 3 ASX shares to sell today

On Monday I looked at three shares that leading brokers had named as buys this week.

Today I thought I would look at the shares which have fallen out of favour with brokers and been given sell ratings.

Three that caught my eye are listed below, here’s why they have fallen out of favour:

AGL Energy Ltd (ASX: AGL)

According to a note out of Morgan Stanley, it has retained its underweight rating and $19.44 price target on this energy retailer’s shares. The broker appears to believe that AGL Energy’s earnings may peak this year before trending lower due largely to political developments. I completely agree with Morgan Stanley on this one and feel energy prices are going to be a hot topic during the next election. I would suggest investors avoid the sector for the time being.

Primary Health Care Limited (ASX: PRY)

Analysts at UBS has retained their sell rating and cut the price target on this healthcare company’s shares to $2.70. The broker made the move after the Fair Work Commission released a decision and draft Workplace Determination relating to support employees within its Dorevitch pathology business. The Determination is expected to hit underlying net profit by $4.5 million and UBS has revised its forecasts to account for the changes. I would agree with the broker on Primary Health Care as well. I think there are far better options in the healthcare sector to consider at this stage.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

A note out of the Macquarie equities desk reveals that its analysts have downgraded the airport operator’s shares to an underperform rating from neutral but increased the price target on its shares to $7.13. According to the note, the broker believes that the upcoming Productivity Commission review could weigh on Sydney Airport’s shares as concerns over regulatory intervention impact investor sentiment. In addition to this, Macquarie expects the airport operator’s dividend growth to slow in the coming years as it prepares to pay tax again. I would suggest investors consider following Macquarie’s recommendation, especially with U.S. rates rising and bond yields likely to widen.

While those shares may be the ones to sell, these are the shares to buy in my opinion.

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