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 shares are in the buy zone:
Audinate Group Ltd (ASX: AD8)
According to a note out of UBS, its analysts have retained their buy rating and lifted their price target on this digital audio-visual networking technologies provider's shares to $8.00. This follows the release of a better than expected first quarter update. It was impressed with its performance in a tough environment and notes that sales are back to pre-COVID levels. It appears optimistic that this positive form will continue throughout FY 2021 and Audinate will achieve its forecasts. I agree with UBS and feel that Audinate could be a great long term option.
IDP Education Ltd (ASX: IEL)
A note out of Morgan Stanley reveals that its analysts have retained their overweight rating and $24.00 price target on this student placement and language testing company's shares. The broker notes that its largest shareholder, Education Australia, is considering a further sell-down of its holding to provide financial support its own shareholders – 38 universities. Morgan Stanley doesn't expect a sell-down to have any real impact on the company's relationships with these universities. In light of this, it appears to see the recent share price weakness as a buying opportunity. I would have to agree with the broker on this one.
Redbubble Ltd (ASX: RBL)
Analysts at Goldman Sachs have retained their buy rating and lifted the price target on this ecommerce company's shares to $6.25. This follows the release of a first quarter update which revealed a 116% increase in revenue and material gross margin improvements. Goldman was also pleased to see that this growth was not driven purely by face mask sales. In fact, face mask revenue fell from 27% of revenue in July to 14% of revenue in September. This has given the broker greater confidence that its strong form can be maintained and led to Goldman increasing its earnings forecasts. I agree and feel Redbubble could be worth a closer look.
