On Monday I looked at three ASX shares that have been given buy ratings by brokers this week.
Unfortunately, not all shares have been lucky enough to have been given the highly coveted buy rating.
The three shares listed below have all been given sell ratings. Here's why:
Adelaide Brighton Ltd (ASX: ABC)
According to a note out of UBS, its analysts have retained their sell rating and reduced the price target on this building products company's shares to $3.90 following the release of its full year results last week. The broker appears concerned that the weak outlook for the housing market is going to weigh on the company's performance in the near term, especially with management advising of cost pressures in FY 2019 from energy and imports. The Adelaide Brighton share price is currently trading at $4.75.
Metcash Limited (ASX: MTS)
A note out of Citi reveals that its analysts have retained their sell rating and $2.45 price target on the wholesale distributor's shares following its strategy and trading update. Although the broker has increased its forecasts for FY 2020 onwards in response to the announced initiatives, it has held firm with its sell rating as it fears there are still structural challenges that put it at risk of falling short of the market's expectations. The Metcash share price last traded at $2.67.
Ramsay Health Care Limited (ASX: RHC)
Analysts at Goldman Sachs have retained their sell rating but lifted the price target on this private hospital operator's shares slightly to $52.00. According to the note, Goldman was encouraged with its recent half year result and the expansion of its Australian hospitals margin. It believes this is a testament to the progress on operational efficiencies. However, it is concerned that this has heightened renegotiation risk when it renegotiates with its two largest payors within the next six months. Especially at a time when healthcare affordability is likely to be a central issue. In addition to this, the broker believes we are only in the early stages of the shift to outpatient or lower-cost settings for several key indications. Ramsay's shares are currently changing hands at $63.03.
