Which ASX 200 shares have been slapped with price downgrades this week?

Big brokers have come out of holidays with a number of downgrades on major ASX 200 shares. Here are 3 of their picks.

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Big brokers have come off their holiday breaks this week with updates on a number of ASX 200 shares. Here are the broker downgrades from 12 January 2021 to watch out for. 

AGL Energy Limited (ASX: AGL) 

The AGL share price has fallen more than 40% in the last 12 months, despite a market leading 7.80% dividend yield. 

The energy company recently slashed its FY21 guidance, now expecting underlying profit after tax to be between $500 million and $580 million, down from the previous guidance range of $560 million to $660 million.

As a result, Credit Suisse lowered its AGL share price target from $12.60 to $11.00 with an underperform rating. This represents a downside of 9% to its share price of $12.07 at close of trade today. 

ASX Ltd (ASX: ASX) 

The ASX share price has struggled to deliver shareholder return in 2020,  slumping 10% over the year. The most notable event for ASX last year was on 16 November, where a software glitched caused an embarrassing all-day outage

Credit Suisse lowered its ASX share price target from $73.00 to $71.00 with an underperform rating. This follows a similar logic to that of Goldman Sachs, which maintained a sell rating for ASX shares on 20 December 2020.

Goldman described the company at the time as “expensive given headwinds” after the company’s mixed performance, with weaker derivatives and over-the-counter (OTC) markets but solid performances across its listings and issuer services, trading services and equity post-trade services. 

Magellan Financial Group Ltd (ASX: MFG) 

Goldman Sachs remains sell rated on Magellan with a price target of $50.70. The broker’s commentary highlights Magellan’s funds under management falling 1.6% from $103.0 billion to $1.1.4 billion during December.

The key drivers of Goldman’s stance was the fund’s underperformance. Relative performance was soft in December, with the Global Fund underperforming the benchmark by -2.7%, following an -8.8% underperformance in November. The broker believes that Magellan is most negatively exposed to the recent US senate run-off elections which could result in lower performance fees and funds under management.  

Citi also lowered its Magellan share price target from $60.00 to $56.50 with a neutral rating. While Credit Suisse lowered its price target from $58.50 to $55.00. 

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Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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