It has been another busy week for many of 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 right now:
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Capricorn Metals Ltd (ASX: CMM)
According to a note out of Bell Potter, its analysts have retained their buy rating on this gold miner's shares with an improved price target of $6.49. Bell Potter has been looking over Capricorn Metals' FY 2024 results and was pleased with what it saw. It highlights that the company still achieved very strong EBITDA margins despite facing weather disruptions and lower production year on year. Outside this, the broker believes that Capricorn Metals would be a great option for investors looking for exposure to gold. This is because it is a sector leading gold producer with a strong balance sheet, has a management team with an excellent track record of delivery, and a clear organic growth options to lift group production to 270,000 ounces per annum. The Capricorn Metals share price is trading at $5.52 today.
Challenger Ltd (ASX: CGF)
A note out of Goldman Sachs reveals that its analysts have retained their buy rating and $8.00 price target on this annuities company's shares. This follows news that strategic partner and major shareholder, Apollo, has been selling down its stake in the company. While Goldman believes there is now a greater risk of a potential further sell down, particularly if the risk/reward dynamic does not stack up relative to new opportunities, it was comforted by confirmation that both Apollo and Challenger remain committed to their ongoing commercial partnership. This is focused on asset origination and establishing a non-bank lending joint venture in Australia. Outside this, the broker is positive on the company due to its exposure to the growing superannuation market across Life and Funds Management. It also expects higher yields to drive a favourable sales environment for retail annuities and support margin improvements. The Challenger share price is fetching $6.29 on Friday.
REA Group Ltd (ASX: REA)
Analysts at Macquarie have retained their outperform rating on this property listings company's shares with an improved price target of $229.00. This follows news that REA Group is looking at a possible takeover of UK peer Rightmove (LSE: RMV). Macquarie estimates that the company would need to raise $6.1 billion of equity to acquire the company. But this could still be worth it given its expectation that a 20% takeover premium could result in earnings per share accretion of 14%. The REA Group share price is trading at $205.85 at the time of writing.
