Many of Australia's top brokers have been busy adjusting their financial models and recommendations again. This has led to the release of a number of broker notes this week.
Three ASX shares that brokers have named as buys this week are listed below. Here's why their analysts are feeling bullish on them right now:
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A2 Milk Company Ltd (ASX: A2M)
According to a note out of Citi, its analysts have retained their buy rating but cut their price target on this infant formula company's shares to $7.04. The broker appears to believe that this week's post-results selloff has created a buying opportunity for investors. In fact, the broker thinks that A2 Milk's underlying operational momentum will continue despite its weak guidance for FY 2025. And while the broker has cut its earnings estimates and valuation meaningfully, it suggests that this is because of a temporary hiccup from supply issues that will ease in time. And with key metrics around demand remaining strong, Citi thinks now is the time to buy its shares while they are down. The A2 Milk share price is trading at $5.64 this afternoon.
Deterra Royalties Ltd (ASX: DRR)
A note out of Goldman Sachs reveals that its analysts have retained their buy rating on this mining royalties company's shares with a trimmed price target of $4.60. This follows the release of a full year result which was a touch short of expectations. However, with its shares falling significantly since announcing a new acquisition, the broker believes they are still vastly undervalued by the market. And that's even after factoring in the uncertainty over future dividend payouts and capital returns following changes to its dividend policy. It notes that Deterra Royalties' shares are trading at ~10x EBITDA for FY 2025 versus global peers on ~15x EBITDA. The Deterra Royalties share price is fetching $3.86 today.
Seek Ltd (ASX: SEK)
Analysts at Morgan Stanley have retained their overweight rating on this job listings company's shares with a reduced price target of $28.00. According to the note, Morgan Stanley has been combing through Seek's FY 2024 results. And while disappointed with its performance and guidance for FY 2025, it isn't concerned. After speaking with industry participants, the broker has come to the conclusion that the current weakness is cyclical and not structural. As a result, it believes the recent decline in the company's share price represents a buying opportunity for investors. The Seek share price is trading at $21.35 on Wednesday.
