Last week was filled once again with a large number of broker notes hitting the wires. Three buy ratings that caught my eye are summarised below.
Here's why brokers think investors ought to buy them next week:
Clover Corporation Limited (ASX: CLV)
According to a note out of UBS, its analysts have retained their buy rating and increased the price target on this infant formula ingredient producer's shares to $2.10 following its first half results release. UBS appeared to be pleased with Clover's first half results, particularly with its margin expansion. And while it was a touch disappointed with its cash flow, this was due to the company's higher than expected investment in inventory due to the expected increase in demand from China and Europe. I think Clover is an interesting way of playing the infant formula boom and well worth a closer look.
Nufarm Limited (ASX: NUF)
A note out of Goldman Sachs reveals that its analysts have retained their buy rating on this crop protection and specialist seed company's shares, albeit with a revised price target of $6.00. Goldman has held firm with its buy rating despite Nufarm downgrading its full year guidance when it released its half year results last week. The broker believes the selling of its shares has been overdone and created a buying opportunity. Especially given its view that Nufarm is likely to be a beneficiary of a structurally improving crop protection industry long-term. Whilst things are admittedly tough for Nufarm, I feel it could be worth a look at these levels.
TPG Telecom Ltd (ASX: TPM)
Analysts at Morgan Stanley have retained their overweight rating and $7.15 price target on this telco company's shares following the release of its half year results. According to the note, TPG Telecom's results came in a touch ahead of expectations. The company's Corporate segment impressed the broker with its lower costs and stronger earnings. Overall, Morgan Stanley appears positive on the second half and feels TPG Telecom is a buy at these levels. Whilst I think the broker makes some fair points, I would suggest investors keep their powder dry until the ACCC decides on its merger with Vodafone Australia.
