With so many shares to choose from on the Australian share market, it can be hard to decide which ones to buy.
The good news is that brokers across the country are doing a lot of the hard work for you.
Three top shares that leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:
Fortescue Metals Group Limited (ASX: FMG)
According to a note out of the Macquarie equities desk, its analysts have retained their outperform rating but trimmed the price target on Fortescue’s shares to $10.60. The broker continues to remain positive on the iron ore producer following its decision to raise US$600 million to repay a portion of its term loan. Outside this, Macquarie believes there is upside risk to spot prices and notes that its shares are trading on a notably high free cash flow yield. The latter bodes well for dividends in FY 2020. Whilst I prefer more diversified miners, I do agree that Fortescue’s shares look great value today. Just as long as iron ore prices remain at current levels.
James Hardie Industries plc (ASX: JHX)
Analysts at Morgan Stanley have retained their overweight rating and $25.00 price target on this building products company’s shares ahead of its investor event this week. According to the note, the broker is expecting a positive update at the event and notes the strong growth being delivered by its European fibre cement business. It appears confident more of the same is coming over the next few years and continues to believe its shares are in the buy zone at the current level. I think James Hardie is a quality company and could be worth a closer look.
Mirvac Group (ASX: MGR)
A note out of Citi reveals that its analysts have upgraded this property group’s shares to a buy rating from neutral and lifted the price target on them to $3.50. According to the note, the broker made the move largely on valuation grounds after running the rule over Australian REITs. The broker believes investors should buy Mirvac over retail REITs. It has concerns over the bearish outlook for retail landlords and expects conditions to deteriorate further in the near term. I agree with Citi that Mirvac would be a good option, especially given its ~4% dividend yield.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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.