It has been a little quiet on the broker note front this week due to the imminent Christmas break.
In light of this, I thought I would pick out three recent broker buy recommendations that have stood out this month.
Here's why leading brokers think investors should be buying these ASX shares:
Afterpay Limited (ASX: APT)
Analysts at Goldman Sachs have retained their conviction buy rating and $42.90 price target on this payments company's shares. The broker was pleased with After[ay's performance in November and during the Black Friday and Cyber Monday sales events. Afterpay reported a 160% increase in underlying sales in November and revealed that it has now surpassed 3 million customers in the United States and 500,000 in the United Kingdom. This lifted total customer numbers to 6.6 million. I agree with Goldman Sachs on Afterpay and feel it could be a great buy and hold option for investors with a higher tolerance for risk.
CSL Limited (ASX: CSL)
According to another note out of Goldman Sachs, its analysts have retained their buy rating and lifted the price target on this biotherapeutics giant's shares to $312. Goldman increased its price target after running the rule over its R&D pipeline. After assessing the data and likely regulatory pathway, the broker calculates a total risk-adjusted valuation of $38 per share is in its near term pipeline. I also agree with Goldman Sachs on CSL and believe it would be another great long-term option. This is due to the aforementioned pipeline and the strong demand it is experiencing for its existing products.
Xero Limited (ASX: XRO)
A note out of Morgan Stanley reveals that its analysts have retained their overweight rating and lifted the price target on this accounting software provider's shares to $90. Morgan Stanley looks to have been impressed with Xero's first half result and particularly its margin expansion. It also notes that Xero's international contribution margins are breaking even for the first time. Overall, the broker forecasts strong sales growth in FY 2020 and appears confident this can continue in the near term. I think Morgan Stanley is on the money with this one and agree that it is a buy.
