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:
AGL Energy Limited (ASX: AGL)
According to a note out of Morgan Stanley, its analysts have retained their underweight rating and slashed the price target on this energy company’s shares to $10.68. The broker sees notable electricity price weakness ahead and expects the rise of renewable energy to weigh heavily on the company’s earnings in the coming years. The AGL Energy share price ended the week at $12.00.
Pact Group Holdings Ltd (ASX: PGH)
Another note out of Morgan Stanley reveals that its analysts have downgraded this packaging company’s shares to an underweight rating with a $2.60 price target. The broker made the move largely on valuation grounds and notes that there are more attractive options for investors in the industry. And while it sees positive catalysts such as its turnaround plans and asset sales, it isn’t enough to maintain its equal-weight rating. The Pact share price last traded at $2.65.
QBE Insurance Group Ltd (ASX: QBE)
Analysts at Macquarie have retained their underperform rating and cut the price target on this insurance giant’s shares to $7.70. According to the note, Macquarie has concerns that the company is going through a tough period without a permanent CEO. In light of this, it sees risks ahead in FY 2021. In addition to this, the broker is expecting the company to make a big dividend cut due to the large loss that it is forecasting for FY 2020. The QBE share price ended the week at $8.57.
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Motley Fool contributor James Mickleboro 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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