A large number of broker notes have hit the wires this week, leading to many popular shares being declared buys and sells.
Three shares that are in favour with brokers and have been given a buy rating are listed below. Here's why they are bullish on them:
Adairs Ltd (ASX: ADH)
A note out of UBS reveals that its analysts have retained their buy rating and $2.60 price target on this homewares retailer's shares ahead of its half year results. According to the note, the broker believes the market is undervaluing the company's fast-growing online business. It appears bullish on this side of the company, especially given the acquisition of Mocka. The broker feels a re-rating could be on the horizon if its online business continues to perform strongly. I think UBS is spot on and Adairs could be worth a closer look.
Nearmap Ltd (ASX: NEA)
According to a note out of Citi, its analysts have retained their (high risk) buy rating and $4.05 price target on this aerial imagery technology and location data company's shares. Although the broker was disappointed with the downgrade to its guidance, it notes that the loss of a large contract and two churn/downgrade events were not caused by competition. Instead these were due to market conditions. Citi appears optimistic on the future and pleased with its strong growth in North America. I agree with Citi and feel the selloff could be a buying opportunity for investors.
Telstra Corporation Ltd (ASX: TLS)
Analysts at Goldman Sachs have retained their conviction buy rating and lifted the price target on this telco giant's shares to $4.40. According to the note, Telstra is Goldman's top pick in the ANZ telco sector. It likes the company due to its earnings trajectory in mobiles, significant cost cutting opportunity, improving free cash flow trajectory, and its potential to crystallise additional value from its infrastructure assets. Furthermore, the broker believes the outlook for the Australian mobile market in 2020 remains positive. I agree with Goldman Sachs and would be a buyer of Telstra's shares at this level.
