Many of Australia's leading brokers have been busy adjusting their discounted cash flow models and recommendations to account for new data and developments.
Three shares that have come out of this favourably are listed below. Here's why they have been given buy ratings:
According to a note out of UBS, it has upgraded this auto parts retailer's shares to a buy rating from neutral with a slightly reduced price target of $7.05. The broker has been busy going through the retail sector and adjusting forecasts and recommendations accordingly. Bapcor has come out favourably with UBS forecasting earnings per share growth of 8.5% this year and then 15% in FY 2020. I agree with UBS that Bapcor's shares are in the buy zone right now. And if its overseas expansion is a success, it could prove to be a great long term investment.
BWX Ltd (ASX: BWX)
A note out of Goldman Sachs reveals that its analysts have retained their buy rating and $4.20 price target after the personal care company appointed more board members. The broker appears pleased with these appointments and is now awaiting news relating to U.S. appointments. In the meantime, Goldman sees a lot of value in its shares at current levels and notes that they are trading at a significant discount to its global peers. While I do agree that BWX's shares are trading at very attractive levels, I intend to wait for signs of improvement in its Sukin sales before considering an investment.
Wesfarmers Ltd (ASX: WES)
Analysts at Morgans have upgraded this conglomerate's shares to an add rating with a revised price target of $33.64. According to the note, the broker notes that without the Coles Group Limited (ASX: COL) business, Wesfarmers will be heavily reliant on the Bunnings business for its future growth. The good news is that Morgans believes that a slowdown in residential building activity is nothing to be concerned about as it expects demand from renovations and replacements to remain strong. Although I intend to wait for a better entry point, I think that Morgans makes a good point.
