Many of Australia's top brokers have been busy adjusting their financial models again, leading to the release of a large number of broker notes this week.
Three broker buy ratings that have caught my eye are summarised below. Here's why brokers think these ASX shares are in the buy zone:
Bega Cheese Ltd (ASX: BGA)
According to a note out of UBS, its analysts have retained their buy rating but cut the price target on this food company's shares to $5.10. Although the broker notes that Bega Cheese's guidance for FY 2020 means that it is close to breaching its debt covenants, it doesn't expect its lenders to enforce these covenants due to its strong assets and inventory. Looking ahead, it expects market conditions to return to normal by FY 2022. Whilst I think UBS makes some good points, I would rather wait for a notable improvement in its performance before investing.
Bravura Solutions Ltd (ASX: BVS)
A note out of the Macquarie equities desk reveals that its analysts have retained their outperform rating and $5.55 price target on this fintech company's shares. According to the note, the broker appears pleased that the acquisition of FinoComp will enhance its wealth management capability. It has also previously spoken positively about its Midwinter acquisition. Which it believes offers attractive structural growth in Australia and the UK. I agree with Macquarie and would also class its shares as a buy.
Coles Group Ltd (ASX: COL)
Analysts at Goldman Sachs have retained their buy rating and lifted the price target on this supermarket giant's shares to $15.90 following its first quarter update. According to the note, the broker was pleased with Coles performance, especially considering the strong trading period it was cycling. It expects its sales to improve from here, just as long as weather conditions remain favourable. I agree with Goldman on Coles and would be a buyer of its shares.
