On Monday 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 that have just been given sell ratings are listed below. Here’s why these brokers are bearish on these ASX shares:
Commonwealth Bank of Australia (ASX: CBA)
According to a note out of Morgan Stanley, its analysts have retained their underweight rating and lifted the price target on this banking giant’s shares to $89.50. Morgan Stanley notes that CBA appears to be winning in business banking, with above-system volume growth and good margin management potentially supporting pre-provision profit growth for the first time in four years. In addition to this, the broker points out that the bank’s balance sheet is very strong. However, despite all the many positives, Morgan Stanley can’t look beyond its stretched valuation and holds firm with its underweight rating. The CBA share price is fetching $99.11 this afternoon.
Qantas Airways Limited (ASX: QAN)
Analysts at Credit Suisse have retained their underperform rating and $4.15 price target on this airline operator’s shares. According to the note, the broker has been looking at rival domestic routes. It suspects that the increasing competition will offset some of the benefits from the $1 billion cost savings Qantas is making. In addition to this, Credit Suisse believes the company will need to invest heavily in its aircraft due to its ageing fleet. The Qantas share price is trading at $4.70 today.
Zip Co Ltd (ASX: Z1P)
A note out of UBS reveals that its analysts have retained their sell rating and $6.75 price target on this buy now pay later (BNPL) provider’s shares. According to the note, the broker believes that the company’s expansion into mainland Europe and the Middle East will provide it with a significant market opportunity. However, it notes that its acquired businesses are at a relatively early stage and could require significant capital in order to scale up. The Zip share price is fetching $7.16 on Tuesday afternoon.