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:
Monadelphous Group Limited (ASX: MND)
According to a note out of Citi, its analysts have downgraded this engineering company’s shares to a sell rating and slashed the price target on them to $15.50 following its full year results. Monadelphous’ result fell short of the broker’s estimates and it doesn’t expect things to get better any time soon. The broker believes that margin pressures will weigh on its profits in the near term and has reduced its forecasts accordingly. The Monadelphous share price is down 3.5% to $16.32 this afternoon.
NIB Holdings Limited (ASX: NHF)
Analysts at UBS have downgraded this private health insurer’s shares to a sell rating but lifted the price target on them to $6.40. According to the note, the broker believes that an increase in higher hospital claims inflation late in FY 2019 could be a sign that margin compression is coming. Combined with lower bond yields, it suspects that its earnings could disappoint in FY 2020. This could mean it will be unable to deliver a level growth that justifies the premium its shares trade at today. NIB’s shares are up 0.5% to $7.11 today.
Platinum Asset Management Ltd (ASX: PTM)
A note out of Morgan Stanley reveals that its analysts have retained their underweight rating and trimmed the price target on them to $3.35. According to the note, the broker believes that the company’s poor performance could lead to an acceleration in funds outflows in the first half of FY 2020. And with the broker not expecting things to improve in the near term, it has downgraded its estimates through to FY 2021 to reflect this. The Platinum share price dropped to a multi-year low of $3.96 earlier today.
Whilst those may be the shares to sell, these are the shares that have been rated as buys.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended 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.