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:
Bendigo and Adelaide Bank Ltd (ASX: BEN)
According to a note out of Morgan Stanley, its analysts have retained their underweight rating but lifted the price target on this regional bank’s shares to $7.70. While the broker notes that the bank’s housing loan growth is well ahead of forecasts and that recent changes from APRA are favourable, it doesn’t believe its shares offer value for money at the current level. The broker prefers other options in the banking sector. The Bendigo and Adelaide Bank share price ended the week at $9.48.
National Storage REIT (ASX: NSR)
A note out of Goldman Sachs this week reveals that its analysts have retained their sell rating but lifted the price target on this self-storage operator’s shares slightly to $1.57. This follows the release of the company’s trading update and guidance for FY 2021. While the broker was pleased with aspects of this update, there wasn’t enough detail to allow it to change its view. In addition, Goldman Sachs has an issue with its current valuation, which it appears to believe is excessive compared to its peers. It notes that its shares are trading at a 23x estimated FY 2022 FFO. This compares to a sector average of 17x. The National Storage share price was trading at $1.96 at the end of the week.
QBE Insurance Group Ltd (ASX: QBE)
Analysts at Macquarie have retained their underperform rating and $8.00 price target on this insurance giant’s shares. This follows the release of a trading update which revealed that the company is expecting to post a huge loss in FY 2020. Unfortunately, Macquarie doesn’t appear convinced that the worst is over. Particularly given that QBE’s return on capital expectations in North America are below its cost of capital. The QBE share price ended the week at $8.86.