Last week saw a large number of broker notes hitting the wires once again. Three buy ratings that caught my eye are summarised below.
Here’s why brokers think investors ought to buy them next week:
Brickworks Limited (ASX: BKW)
According to a note out of UBS, its analysts have resumed coverage on this building products company’s shares with a buy rating and $17.10 price target. UBS is positive on Brickworks largely because of its joint venture with Goodman Group (ASX: GMG). It believes the market is overlooking the potential upside from this joint venture. Especially after its recently announced deal with Amazon, which gives it exposure to the growing ecommerce market. While I think Brickworks could be a decent option, I would sooner buy Goodman’s shares ahead of it.
Jumbo Interactive Ltd (ASX: JIN)
Analysts at Morgans have upgraded this online lottery ticket seller’s shares to an add rating with an improved price target of $11.58. Although it acknowledges that the new Tabcorp Holdings Limited (ASX: TAH) reseller agreement will eat into its margins with its growing service fees, it appears happy that it has signed such a long term deal. This has removed a key risk hanging over the company and allows it to focus on growing the Powered By Jumbo (SaaS) business. I agree with Morgans and feel Jumbo could be a great buy and hold option for investors.
NEXTDC Ltd (ASX: NXT)
A note out of Goldman Sachs reveals that its analysts have retained their buy rating and lifted their price target on this data centre operator’s shares to $11.10. This follows its announcement of new contract wins in New South Wales. Goldman believes that these new contracts (and their commitment options) will support its earnings estimates. It has forecast an FY 2019-FY 2023 EBITDA compound annual growth rate of +25%. I think that Goldman Sachs is spot on and feel NEXTDC would be a fantastic buy and hold option.
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James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Jumbo Interactive Limited. The Motley Fool Australia owns shares of and has recommended Brickworks and Jumbo Interactive Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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