On Wednesday I looked at three ASX shares that brokers have given buy ratings to this week. Unfortunately, not all shares are in favour with them right now.
Three that have just been given sell ratings are listed below. Here's why these brokers are bearish on them:
Coles Group Ltd (ASX: COL)
According to a note out of UBS, its analysts have retained their sell rating and $11.30 price target on this supermarket giant's shares despite the announcement of its exclusive partnership with Ocado. While the broker believes the deal has de-risked its long-term online strategy, the lack of detail around the deal means the broker has retained its bearish stance. UBS has previously stated that it has concerns over company-specific pressures and the need for increased investment. The Coles share price is trading 1.5% lower on Thursday at $11.72.
Spark New Zealand Ltd (ASX: SPK)
A note out of Credit Suisse reveals that its analysts have retained their underperform rating but increased the price target on the New Zealand-based telco company's shares to NZ$3.39 (A$3.25). According to the note, the broker believes the company has opportunities to grow its earnings modestly over the short term, but feels its shares are overvalued at the current level. Especially given its increasing debt levels. The Spark New Zealand share price has pushed 1.5% higher to $3.70 today.
Wesfarmers Ltd (ASX: WES)
Analysts at Citi have retained their sell rating and $29.00 price target on this conglomerate's shares after it announced a takeover approach for rare earths producer Lynas Corporation Ltd (ASX: LYC). According to the note, the broker was surprised by the company's decision and believes it is a sign that finding quality assets to acquire is harder that you might think in this market. Citi believes the proposed offer, which has since been rejected, has the potential to be 3% accretive to earnings per share before synergies. The Wesfarmers share price is currently trading at $34.50.
