Top brokers name 3 ASX shares to sell next week

Brokers aren’t feeling overly positive on these shares…

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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 investors might want to hear about are summarised below. Here’s why top brokers think investors ought to sell these shares next week:

A2 Milk Company Ltd (ASX: A2M)

According to a note out of Credit Suisse, its analysts have retained their underperform rating and $5.50 price target on this infant formula company’s shares. Credit Suisse feels that the market is mispricing A2 Milk’s shares. Its analysts highlight that the lofty multiples its shares trade on are normally reserved for growing companies in growth sectors. It doesn’t feel that A2 Milk and the maturing Chinese infant formula market tick these boxes. The A2 Milk share price ended the week at $6.89.

Megaport Ltd (ASX: MP1)

A note out of Ord Minnett reveals that its analysts have retained their sell rating and $15.00 price target on this network as a service provider’s shares. This follows the release of a first quarter update that was largely in line with the broker’s expectations. One thing that the broker appears concerned about is Megaport’s rising costs. It notes this is due to its sales and marketing investment and costs relating to the new Megaport Virtual Edge. In light of this, the broker isn’t in a rush to change its rating. The Megaport share price was fetching $17.55 at Friday’s close.

Wesfarmers Ltd (ASX: WES)

Analysts at Citi have retained their sell rating and $49.00 price target on this conglomerate’s shares. According to the note, Wesfarmers delivered an annual general meeting update that was in line with expectations. In light of this, the broker hasn’t seen any reason to change its rating and continues to believe that the company’s shares are overvalued at the current level. The Wesfarmers share price ended the week at $57.31.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended MEGAPORT FPO. The Motley Fool Australia owns shares of and has recommended Wesfarmers Limited. The Motley Fool Australia has recommended A2 Milk and MEGAPORT FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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