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:
Cochlear Limited (ASX: COH)
According to a note out of Credit Suisse, its analysts have retained their underperform rating and $168.00 price target on this hearings solutions company’s shares following a recent update from its rival. Switzerland-based Sonova reported a 4.8% lift in sales and a 16% increase in net profit during its second half. In light of this and its view that Cochlear’s new implant will have little benefit until it is available in all developed markets, its analysts suspect that the company could lose market share to its rivals, putting it at risk of falling short of its guidance. The Cochlear share price is currently up 1.5% to $202.09.
Medibank Private Ltd (ASX: MPL)
A note out of Goldman Sachs reveals that its analysts have retained their sell rating and $2.50 price target on this private health insurer’s shares following the release of APRA’s private health insurance industry data for the March quarter. According to the note, that data revealed that policyholder growth remains negative with further youth exits. Furthermore, the broker believes that the data shows that industry revenue trends are deteriorating and expects further gross margin deterioration to occur. Medibank’s shares are up 1.5% to $3.24 today.
Sonic Healthcare Limited (ASX: SHL)
Analysts at UBS have downgraded this healthcare provider’s shares to a sell rating with an improved price target of $24.90. According to the note, the broker notes that the company is experiencing increasing costs and declining organic revenue growth in several markets. But the main reason for the downgrade is its valuation. UBS believes the market has ascribed a larger than deserved multiple to the company’s Australian pathology. The Sonic Healthcare share price is down over 1% to $26.14 this afternoon.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia has recommended Cochlear Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.