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 they are bearish on them:
Blackmores Limited (ASX: BKL)
According to a note out of the Macquarie equities desk, its analysts have downgraded this health supplements company’s shares to an underperform rating and slashed the price target on them by 30% to $60.00. The broker made the move after its disappointing full year results release and weak trading update. Its analysts believe the company is underperforming due to a combination of weak strategy execution and changing market dynamics. The Blackmores share price fell a further 3.5% to $64.58 on Monday.
InvoCare Limited (ASX: IVC)
Analysts at UBS have downgraded this funerals company’s shares to a sell rating from neutral and cut the price target on them to $12.70. According to the note, UBS was disappointed with its messy half year results and notes that its core business appears to be losing market share. And with the death rate not as strong as expected, it feels there is a risk that its second half could be soft. The InvoCare share price closed the day at $14.57.
NIB Holdings Limited (ASX: NHF)
A note out of Goldman Sachs reveals that its analysts have retained their sell rating and $5.85 price target on this private health insurer’s shares following its full year results release. According to the note, NIB delivered a profit result 5% below Goldman’s expectations in FY 2019. Looking ahead, the broker believes revenue pressures are driving a tough gross margin outlook. And with its shares trading at 24x FY 2020 estimates, it thinks its shares are materially overvalued. NIB’s shares closed the day down 6% at $7.15.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited. The Motley Fool Australia has recommended InvoCare Limited and NIB Holdings Limited. 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.