On Monday I looked at three ASX shares that have been given buy ratings by brokers this week.
Unfortunately, not all shares are in favour with brokers right now. The three shares listed below have all been given sell ratings. Here's why:
DuluxGroup Limited (ASX: DLX)
According to a note out of Morgan Stanley, its analysts have resumed coverage on the building products company with an underweight rating and $6.50 price target. The broker believes that Dulux's shares are expensive at the current level and could come under pressure. Morgan Stanley suspects that the tough trading conditions it faces could mean earnings decline in both FY 2019 and FY 2020. The Dulux share price is currently trading at $7.24.
Pendal Group Ltd (ASX: PDL)
A note out of Credit Suisse reveals that the broker has retained its underperform rating but lifted the price target on the fund manager's shares slightly to $8.00. According to the note, the broker has lifted its price target on Pendal's shares to reflect a small increase to FUMs and earnings per share forecasts. However, it remains concerned that its funds flows could come under pressure in short term and thus retains its bearish view. The Pendal share price is currently trading at $9.45.
Woolworths Group Ltd (ASX: WOW)
Analysts at Macquarie have retained their underperform rating and lifted the price target on this conglomerate's shares slightly to $26.84 after its latest update. According to the note, the broker believes the announcement of the closure of 30 Big W stores and the $1.7 billion off-market share buy back are positives. However, the broker continues to have concerns over operating leverage in the food and drinks business and therefore holds firm with its underperform rating. The Woolworths share price is currently trading at $30.79, implying potential downside of almost 13% for its shares over the next 12 months.
