It has been another busy week of annual general meetings, trading updates, and quarterly reports. Unsurprisingly, this has led to the release of countless broker notes.
Three shares that have fared well and been given buy ratings are listed below. Here’s why brokers are bullish on them:
Boral Limited (ASX: BLD)
According to a note out of Citi, its analysts have upgraded this building products company’s shares to a buy rating with a reduced price target of $7.00. The broker made the move after Boral’s shares fell into oversold territory on the back of concerns over the U.S. housing market cycle and wet weather disruptions. With the broker believing that demand remains strong, it appears to think Boral’s shares are in the bargain bin now. I think Citi could be onto something with Boral. Especially with its shares trading at under 13x the broker’s earnings forecast for FY 2019.
Beach Energy Ltd (ASX: BPT)
A note out of Goldman Sachs reveals that its analysts have upgraded this energy company’s shares to a buy rating with a $1.95 price target. According to the note, the broker was pleased with its strong start to FY 2019 and believes that the risk is now skewed to the upside in respect to its full year production guidance. In addition to this, the broker sees increasing gas demand from Victoria through to 2020 driven by reduced hydro generation. Goldman also points out that Beach Energy’s shares are trading at a significant discount to its peers based on its EV/EBITDA multiple. If oil and gas prices remain at their current levels then I think Beach Energy could be worth considering.
Lovisa Holdings Ltd (ASX: LOV)
Another note out of Citi reveals that its analysts have held firm with their buy rating on this jewellery retailer following its soft first quarter update. The broker has, however, cut the price target on its shares down to $10.75 from $12.30. According to the note, the broker is concerned that things could get worse before they get better in respect to its comparable store sales. This is due to the company cycling even stronger sales in the second quarter. In the first quarter of FY 2019 Lovisa reported a 0.9% decline in comparable store sales. However, the broker has looked beyond this as Lovisa remains a highly profitable company with a strong balance sheet and ambitious international expansion plans. I am a big fan of Lovisa but I do think it could be worth waiting for its half year results before making a move.
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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.