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 Citi, its analysts have downgraded this struggling infant formula company's shares to a sell rating and slashed their price target on them to $4.80. Citi has a number of concerns which it appears to believe have shifted the risks to the downside. These include supply disruption in China following lockdowns, weak pricing on Chinese ecommerce reseller platforms, and delays with its SAMR re-registration. Citi notes that the latter is far from guaranteed and could materially impact its sales should it not be granted. The A2 Milk share price is trading at $5.04 on Sunday.
IGO Ltd (ASX: IGO)
A note out of UBS reveals that its analysts have initiated coverage on this battery materials miner's shares with a sell rating and $12.65 price target. Although UBS notes that IGO provides investors with exposure to an attractive area of the resources sector, it isn't enough for a more positive rating. This is due to concerns over its current valuation. In addition, UBS fears that current lithium and nickel prices are unsustainable. The IGO share price was fetching $13.68 at Friday's close.
Magellan Financial Group Ltd (ASX: MFG)
Analysts at Macquarie have retained their underperform rating but lifted their price target on this fund manager's shares to $13.25. This follows the release of Magellan's latest funds under management update. While Macquarie was pleased to see Magellan's fund outflows slow, it thinks it may be too soon to get excited. The broker isn't expecting the outflows to stop any time soon. Particularly given the poor investment performance of its funds. The Magellan share price ended the week at $16.95.
