On Wednesday I looked at three ASX shares that brokers have given buy ratings to this week.
Unfortunately, not all shares are in favour with them right now. Three ASX shares that have just been given sell ratings by brokers are listed below. Here's why these brokers are bearish on them:
Afterpay Ltd (ASX: APT)
According to a note out of UBS, its analysts have retained their sell rating and lowly $36.00 price target on this payments company's shares. This follows the announcement of a new buy now pay later offering by Commonwealth Bank of Australia (ASX: CBA). It notes that this service will not have additional fees for merchants. The broker believes this highlights the risk Afterpay faces from regulation for its no surcharge rules for merchants. The Afterpay share price is trading at $111.13 today.
Aurizon Holdings Ltd (ASX: AZJ)
Analysts at Goldman Sachs have retained their sell rating and $3.66 price target on this rail freight company's shares. While the broker acknowledges that Aurizon has defensive earnings and a high dividend yield, it has concerns over the impact to valuations from the deterioration in the long term outlook for global coal demand. The Aurizon share price is fetching $3.87 on Thursday afternoon.
Fortescue Metals Group Limited (ASX: FMG)
A note out of Morgan Stanley reveals that its analysts have retained their underweight rating and $17.45 price target on this iron ore producer's shares. According to the note, the broker fears that the recent curbing of production in China to combat pollution could bring the iron ore deficit to an end. It also suspects that the discount between low and high grade iron ore could begin to widen in the future, which would be bad news for the company. The Fortescue share price is trading at $20.36 this afternoon.
