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 S&P/ASX 200 Index (ASX: XJO) shares are in the buy zone:
Australia and New Zealand Banking Group (ASX: ANZ)
According to a note out of Citi, its analysts have upgraded this banking giant's shares to a buy rating with a reduced price target of $24.75. The broker sees value in the banking sector after recent declines and appears confident that the coronavirus crisis will not be as bad as the GFC. However, it does expect earnings and dividends to take a hit. Citi has forecast a $1.30 per share partially franked dividend from ANZ in FY 2021. This equates to a ~9% yield based on its current share price. I think Citi makes some great points and ANZ could be worth considering when the market settles.
IDP Education Ltd (ASX: IEL)
A note out of Morgan Stanley reveals that its analysts have retained their overweight rating but cut the price target on this student placement and language testing company's shares to $18.50. It likes IDP Education due to its structural growth story, significant market opportunity, and strong balance sheet. I think Morgan Stanley is spot on and IDP Education could be a great long-term investment opportunity for investors.
Nearmap Ltd (ASX: NEA)
Analysts at Goldman Sachs have retained their buy rating and cut their price target on this aerial imagery technology and location data company's shares to $1.30. According to the note, the broker has revised its estimates lower to account for weaker Australian and US economic growth outlooks. It expects Nearmap to deliver Annualised Contract Value of $98.5 million in FY 2020, which is below its guidance range of $102 million to $110 million. However, even after factoring in a capital raising of ~$30 million in FY 2021, Goldman still sees value in its shares at the current level. Whilst I think Goldman makes some good points, it might be prudent to see how the Nearmap business fares with the coronavirus outbreak before investing.
