It has been another busy week for Australia's top brokers. This has led to the release of a number of broker notes.
Three broker buy ratings that you might want to know more about are summarised below. Here's why brokers think these ASX shares are in the buy zone:
Coles Group Ltd (ASX: COL)
According to a note out of Citi, analysts have retained their buy rating and $19.00 price target on this supermarket giant's shares. Citi has been visiting stores to get a better idea of how the big two supermarket operators are performing with their respective strategies. It believes that Coles' pricing strategy is resonating more with consumers and will result in stronger sales growth during the fourth quarter of FY 2024. This is based on its belief that Coles' strategy is being executed better and has a stronger value perception. And while Citi rates both supermarket giants as buys, its preference at this point is Coles. The Coles share price ended the week at $16.42.
Pro Medicus Limited (ASX: PME)
A note out of Goldman Sachs reveals that its analysts have reiterated their buy rating on this health imaging technology company's shares with an improved price target of $136.00. This follows news that Pro Medicus has won five new contracts with a minimum contract value of $45 million. Goldman highlights that this brings the company's minimum total contract value (TCV) for new sales this financial year to $245 million. And there's still potential for more contract wins given its sizeable sales pipeline. Goldman believes this supports its view that the company's Visage 7 software is an industry-leading solution and that the company is the incumbent technology leader in radiology and well-placed to take market share. The Pro Medicus share price was fetching $120.12 at Friday's close.
Qantas Airways Limited (ASX: QAN)
Another note out of Goldman Sachs reveals that its analysts have retained their buy rating and $8.05 price target on this airline operator's shares. Goldman believes that the market is severely undervaluing Qantas' shares. It suspects that this could be due to investors pricing in a trade off between investment (fleet and customer) and capital returns (dividends and buybacks). However, the broker believes that Qantas can return significant capital to shareholders and invest in its fleet while still maintaining a strong balance sheet. As a result, its analysts see the Flying Kangaroo's cheap valuation as a buying opportunity. It is also worth noting that Goldman is expecting the Qantas dividend to return in 2025. The Qantas share price ended the week at $6.15.
