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:
Commonwealth Bank of Australia (ASX: CBA)
According to a note out of Morgan Stanley, its analysts have retained their underweight rating and $89.00 price target on this banking giant’s shares. The broker is expecting a solid result from Australia’s largest bank later this month. However, it does have concerns over its outlook commentary given the current lockdowns. Outside this, the broker continues to believe its shares are expensive at the current level and recommends that investors look elsewhere in the sector. The CBA share price ended the week at $99.65.
Paradigm Biopharmaceuticals Ltd (ASX: PAR)
A note out of Morgans reveals that its analysts have retained their reduce rating and $1.69 price target on this biopharmaceutical company’s shares. This follows the release of its fourth quarter update. Morgans has been surprised with how much Paradigm has invested on preparing its osteoarthritis treatment product’s regulatory submission. And with major trial costs still to come and no partnership deals currently, it suspects that the company could require a capital raising. Morgans has also previously voiced concerns over the commercial viability of the product and heavy insider selling. The Paradigm share price was fetching $2.22 at Friday’s close.
Rio Tinto Limited (ASX: RIO)
Analysts at UBS have retained their sell rating and cut their price target on this mining giant’s shares to $102.00. UBS continues to believe that Rio Tinto’s shares are overvalued given how much iron ore contributes to its free cash flow and its expectation for a sharp pullback in the price of the steel making ingredient. It expects the latter to be driven by a build-up in inventories due to softening demand and increasing supply. The Rio Tinto share price ended the week at $133.42.