According to the ASX, there are 2,288 listed entities that can be invested in on the Australian share market.
With so many shares to choose from it can be hard to decide which ones to buy. Luckily, brokers are there to make your life easier by doing the hard work for you and then recommending shares to buy and sell.
Three shares that have been rated as buys by brokers this week are listed below. Here’s why they like them:
Aristocrat Leisure Limited (ASX: ALL)
According to a note out of the Macquarie equities desk, it has retained its outperform rating and $34.00 price target on this gaming technology company’s shares. The broker believes that a recent pullback in Aristocrat Leisure’s shares, despite there being no changes to its outlook or addressable market, is a buying opportunity for investors. Macquarie estimates that the company can grow earnings by a CAGR of 24% over the next three years. I would have to agree with Macquarie on this one. Based on the broker’s forecast of full year earnings per share of $1.23, Aristocrat Leisure’s shares are changing hands at 23x earnings. I think this is very cheap given its current profile.
Kathmandu Holdings Ltd (ASX: KMD)
A note out of Deutsche Bank reveals that it has retained its buy rating and lifted the price target on the outdoor apparel retailer’s shares to NZ$3.45 (A$3.17) following its strong full year result. While the broker notes that there was no trading update or outlook provided with its results, it isn’t concerned and continues to forecast solid growth. I agree with Deutsche on Kathmandu and think it is one of the better options in the retail sector right now, especially with its expansion into the United States.
Rio Tinto Limited (ASX: RIO)
Analysts at Morgans have upgraded this mining giant’s shares to an add rating with an increased price target of $81.32 after it announced plans to return US$3.2 billion to shareholders. In addition to this positive move, the broker believes that recent share price weakness and favourable commodity prices makes Rio Tinto an attractive option for investors. I think Morgans is spot on here and believe Rio Tinto is a great option for investors looking to gain exposure to the resources sector.
Finally, here's a fourth buy-rated share to consider picking up this week.
Scott Phillips has stumbled upon a little-owned stock he believes could be one of the greatest discoveries of his 25 years as a professional investor.
This is your chance to get in early on of what could prove to be a very special investment recommendation. Think about how many investing trends you've missed out on, even though you knew they were going to be big. Don't let that happen again. This is your chance to get in early.
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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.