Once again, a large number of broker notes hit the wires last week. Some of these notes were positive and some were bearish.
Three sell ratings that caught my eye are summarised below. Here's why top brokers think investors ought to sell these shares next week:
Australia and New Zealand Banking Group (ASX: ANZ)
A note out of the Macquarie equities desk reveals that its analysts have retained their underperform rating and $16.50 price target on this banking giant's shares. The broker is concerned that the banking sector could be hit hard during the coronavirus crisis. Its worst case scenario envisages higher credit losses than they experienced during the GFC. In light of this, it expects the banks to have to cut their dividends materially in the near term. The ANZ share price ended the week at $15.79, which is now lower than Macquarie's price target.
Domino's Pizza Enterprises Ltd (ASX: DMP)
Analysts at Citi have retained their sell rating and trimmed the price target on this pizza chain operator's shares to $47.80. According to the note, the broker has downgraded its earnings estimates over the next couple of years due to an expected slowdown in new store growth. In addition to this, the broker has concerns with the high multiples its shares trade on. It suspects that slower than expected earnings growth could lead to a de-rating. Domino's shares ended the week at $48.80.
Qantas Airways Limited (ASX: QAN)
According to a note out of Credit Suisse, its analysts have downgraded this airline operator's shares to an underperform rating with a lowly $2.20 price target. Credit Suisse has been looking at the travel and tourism market and appears concerned that it may take longer than expected to recover. The broker has suggested that a full recovery may be as far out as FY 2023. In addition to this, the broker suspects that the majority of Qantas' future free cash flow will be used to repair its balance sheet. This could put pressure on its dividends. Qantas shares were changing hands for $3.05 at the close of play on Friday.
