On Monday I looked at three ASX shares that have been given buy ratings by leading brokers this week.
Unfortunately, not all shares are in favour with brokers right now. The three shares listed below have all just been given sell ratings. Here's why:
AGL Energy Limited (ASX: AGL)
According to a note out of Citi, its analysts have downgraded this energy company's shares to a sell rating from neutral and trimmed the price target on them to $20.87. Due partly to headwinds such as lower electricity prices and higher input costs for thermal generation, the broker suspects that AGL Energy's earnings may peak in FY 2019. Citi feels that its shares haven't had this priced in and are therefore overvalued at the current level. On Monday AGL Energy's shares closed almost 2% lower at $22.87.
BHP Group Ltd (ASX: BHP)
Analysts at Deutsche Bank have retained their sell rating and $28.00 price target on this mining giant's shares. According to the note, the broker has concerns about BHP's low level of investments compared to its peers. Whilst this is helping to generate strong free cash flows, Deutsche fears it could result in lower operating earnings growth over the next few years. In light of this, the broker suspects that its shares have limited upside from current levels. The BHP share price closed notably higher than this price target at $36.93 on Monday.
Commonwealth Bank of Australia (ASX: CBA)
A note out of the Macquarie equities desk reveals that its analysts have retained their underperform rating and $68.50 price target on this banking giant's shares following the release of its third quarter update on Monday. According to the note, the broker appears to have been disappointed with CBA's performance in the quarter. And although it notes that the bank is ahead of its peers in respect to the resetting of its business, it struggles to justify the premium its shares trade at. The shares of Australia's largest bank closed the day 2.5% lower at $73.50 on Monday.
