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:
BlueScope Steel Limited (ASX: BSL)
According to a note out of Morgan Stanley, its analysts have upgraded this steel producer’s shares to an overweight rating with an improved price target of $27.00. The broker made the move on the belief that current steel spreads will lead to consensus earnings upgrades and put the company in a position to consider capital management initiatives. In response to the favourable trading conditions, Morgan Stanley has upgraded its earnings forecasts materially for the coming years. The BlueScope share price is fetching $21.49 today.
IDP Education Ltd (ASX: IEL)
A note out of UBS reveals that its analysts have retained their buy rating and lifted their price target on this language testing and student placement company’s shares to $31.60. UBS has increased its earnings estimates to reflect the acquisition of the British Council India IELTS business. In addition to this, the broker suspects that this may not be the only business the company acquires from the British Council. This could mean plenty of further earnings accretive acquisitions down the line for IDP. The IDP Education share price is trading at $29.31 this afternoon.
Universal Store Holdings Ltd (ASX: UNI)
Analysts at Macquarie have initiated coverage on this retailer’s shares with an outperform rating and $8.60 price target. According to the note, Macquarie likes Universal due to its geographic spread and further planned expansion in Australia’s two most populous states. Overall, it believes the company’s shares deserve to trade on higher multiples. Particularly given its strong growth prospects and leading position in youth apparel. The Universal Store share price is fetching $7.29 today.