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:
Australian Pharmaceutical Industries Ltd (ASX: API)
According to a note out of Morgan Stanley, its analysts have retained their underweight rating and cut the price target on this pharmacy chain operator and distributor's shares to $1.10. The Priceline pharmacy operator's recent half year results fell short of the broker's expectations. Unfortunately, it doesn't appear confident that the second half will be any better, especially given the closure of some of its stores during the pandemic. In light of this, it sees no reason to change its rating at this time. The Australian Pharmaceutical Industries share price ended the week at $1.14.
Fortescue Metals Group Limited (ASX: FMG)
Analysts at Morgans have retained their reduce rating but increased the price target on this iron ore producer's shares to $8.51. According to the note, the broker was pleased with Fortescue's performance during the third quarter and the strength of its balance sheet. And while it expects Fortescue to benefit from robust iron ore prices, it feels this is more than priced into its shares at the current level. Fortescue's shares were trading at $10.98 at Friday's close.
Wesfarmers Ltd (ASX: WES)
A note out of Citi reveals that its analysts have retained their sell rating and $30.90 price target on this conglomerate's shares. The broker suspects that the deterioration of the Target business could lead to Wesfarmers shutting it down in the near future. Especially given the high level of investment that would be needed to turn it around. Overall, it appears to believe Wesfarmers' shares are fully valued and better options can be found elsewhere. Wesfarmers' shares last traded at $36.33.
