Many of Australia’s top brokers have been busy adjusting their financial models again, leading to the release of a large number of broker notes this week.
Three broker buy ratings that have caught my eye are summarised below. Here’s why brokers think these ASX shares are in the buy zone:
A2 Milk Company Ltd (ASX: A2M)
According to a note out of UBS, its analysts have retained their buy rating but cut their price target on this infant formula company’s shares to NZ$15.50 (A$14.38). While the broker acknowledges that it is battling tough trading conditions and has downgraded its near term earnings estimates to reflect this, UBS remains positive on the long term. This is due to a recovery in demand from daigou sellers and market share gains in China. The a2 Milk share price is fetching $7.40 on Wednesday.
CSL Limited (ASX: CSL)
A note out of Macquarie reveals that its analysts have upgraded this biotechnology company’s shares to an outperform rating with an improved price target of $296.00. According to the note, the broker has seen a significant improvement in foot traffic at US plasma collection centres recently. As a result, the broker has upgraded its estimates to reflect the improving trading conditions. The CSL share price is trading at $278.22 this afternoon.
IDP Education Ltd (ASX: IEL)
Analysts at Morgan Stanley have retained their overweight rating and $30.00 price target on this language testing and student placement company’s shares. According to the note, the broker has downgraded its estimates to reflect the COVID-19 crisis in the key Indian market. However, despite these short term headwinds, the broker suspects that the disruption is only strengthening the company’s competitive position. Overall, it believes IDP Education will come out of the pandemic in a much stronger position at the expense of small competitors. The IDP Education share price is trading at $22.13 today.