Many of Australia’s top brokers have been busy adjusting their financial models 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:
Afterpay Ltd (ASX: APT)
According to a note out of Morgan Stanley, its analysts have retained their overweight rating and lifted the price target on this payments company’s shares to $115. The broker notes that Afterpay has formed a partnership with Westpac Banking Corp (ASX: WBC) that will see it offer savings accounts and cash flow tools. It feels this will give Afterpay valuable data and opportunities to innovate further in the industry. Outside this, it estimates that Afterpay ended the first quarter with 11.3 million active customers and is forecasting strong growth during the important second quarter. I agree with Morgan Stanley and would be a long-term buyer of its shares.
CSL Limited (ASX: CSL)
A note out of UBS reveals that its analysts have retained their buy rating and $346.00 price target on this biotherapeutics company’s shares. This follows the company’s research and development update on Tuesday. It appears pleased with the products under development and expects it to support growth in the coming years. And while it notes that its shares are trading at a premium to its peers, it points out that this premium is still lower than its five-year average. I think UBS is spot on and CSL would be a quality option for investors.
Woolworths Group Ltd (ASX: WOW)
Analysts at Citi have upgraded this retail conglomerate’s shares to a buy rating with an improved price target of $44.50. The broker made the move after it increased its earnings estimates to reflect favourable trading conditions in the grocery market and positive earnings momentum. Citi is forecasting double-digit comparable store sales for Woolworths in the first quarter. While I would buy one of its rivals ahead of it, I still think Woolworths is a top option.
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Returns as of 15th February 2021
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 CSL Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO and Woolworths 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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