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Top brokers name 3 ASX shares to sell next week

ASX shares to avoid

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:

Blackmores Limited (ASX: BKL)

According to a note out of Citi, its analysts have retained their sell rating and $60.60 price target on this health supplements company’s shares. The broker has concerns over the company’s performance in the key China market. Particularly given its market research, which is pointing to market share gains by the is largest competitors. In addition to this, it notes that competition is intensifying in the ANZ market and the daigou channel remains challenged. The Blackmores share price ended the week at $71.63.

Magellan Financial Group Ltd (ASX: MFG)

Analysts at Morgan Stanley have retained their underweight rating and cut the price target on this fund manager’s shares to $41.20. According to the note, the broker has trimmed its price target to reflect changes in its business model that it feels reduces the appropriate price to earnings ratio that its shares trade at. In addition to this, it believes the market is not pricing in a number of risks it is facing and weaker returns from its funds. The Magellan share price last traded at $47.73.

QBE Insurance Group Ltd (ASX: QBE)

A note out of the Macquarie equities desk reveals that its analysts have retained their underperform rating and $7.70 price target on this insurance giant’s shares. The broker notes that QBE has added an additional US$185m risk margin to cover potential business interruption claims in Australia following an unfavourable ruling in British courts. Outside this, it has concerns over QBE operating through a very difficult period without a permanent CEO. It is also expecting the insurance giant to make huge cuts to its dividend this year. The QBE share price ended the week at $8.45.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited. 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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