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Top brokers name 3 ASX shares to sell next week

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:

A2 Milk Company Ltd (ASX: A2M)

According to a note out of Citi, its analysts have retained their sell rating and cut the price target on this infant formula company’s shares to $14.20. Although the broker believes the headwinds the company is facing will only be temporary, it has concerns they may remain for longer than you might expect. Especially given how Chinese tourists and students, which support the daigou channel, are unable to enter Australia at present. The a2 Milk share price ended the week lower than this price target at $13.98.

AGL Energy Limited (ASX: AGL)

Analysts at Morgan Stanley have retained their underweight rating and $14.14 price target on this energy company’s shares. This follows news that the Tomago Smelter is looking to renegotiate its contract with AGL. The broker sees risks from renegotiations, which only adds to the headwinds it is facing. Overall, its analysts suspect that the next few years could be challenging for AGL and investors can find better options elsewhere. However, a heavy decline last week means the AGL share price is now trading below this target price at $13.50.

Capricorn Metals Ltd (ASX: CMM)

A note out of the Macquarie equities desk reveals that its analysts have retained their underperform rating but lifted the price target on this gold miner’s shares to $1.70. Although the broker has lifted its gold price forecasts and earnings estimates, which led to its price target increase, it doesn’t see enough value in its shares at the current level to change its rating. Macquarie sees more value in other gold miners. The Capricorn Metals share price ended the week at $1.76.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended A2 Milk. 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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