Australia’s top brokers have been busy adjusting their estimates and recommendations 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 ASX 200 shares are in the buy zone:
Altium Limited (ASX: ALU)
According to a note out of Morgan Stanley, its analysts have retained their overweight rating and $40.00 price target on this electronic design software company’s shares. The broker has been looking through the second quarter update by its rival Cadence Designs. While it sees potential near term risks from the tough trading conditions the industry is experiencing because of the pandemic, it remains very positive on its long term outlook. I agree with Morgan Stanley and would be a buyer of its shares.
Nanosonics Ltd (ASX: NAN)
A note out of Morgans reveals that its analysts have upgraded this infection prevention company’s shares to an add rating with a $6.92 price target. The broker made the move on valuation grounds after a pullback in the Nanosonics share price. While the broker suspects that its full year results could be softer than expected due to the tough operating environment caused by the pandemic, it believes it is worth sticking with the company. Morgans believes Nanosonics is well-placed for long term growth thanks to its highly regarded trophon technology, upcoming product launches, and the growing importance of high level disinfection. I completely agree with Morgans and feel the recent share price weakness is a buying opportunity.
Newcrest Mining Limited (ASX: NCM)
Analysts at UBS have retained their buy rating and lifted the price target on this gold miner’s shares to $38.40 following its quarterly update. According to the note, Newcrest’s production for the June quarter came in ahead of its expectations and its costs were in line with its estimates. The broker also notes that drilling results at Haverion have been positive and the probability of the site being mined has increased. UBS doesn’t believe the market is factoring this into its valuation at present. I think UBS makes some good points and Newcrest could be a decent option if you’re wanting exposure to gold.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Nanosonics Limited. The Motley Fool Australia has recommended Nanosonics 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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