With so many shares to choose from on the Australian share market, it can be difficult to decide which ones to buy. The good news is that brokers across the country are doing a lot of the hard work for you.
Three top ASX shares that leading brokers have named as buys this week are listed below. Here's why they are bullish on them:
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Accent Group Ltd (ASX: AX1)
According to a note out of Morgan Stanley, its analysts have retained their overweight rating on this footwear retailer's shares with an improved price target of $2.75. The broker has named the company as one of its key mid cap picks. This is due to its belief that Accent's margins could be better than expected in the near term due to operating leverage. It also highlights that some of the company's new brands are performing well, which is promising for their long term futures. In addition, Morgan Stanley highlights that Accent stands to benefit from falling inflation and interest rate cuts given that its target demographic has been hit hard from the cost of living crisis. The Accent share price is trading at $2.26 on Monday.
Challenger Ltd (ASX: CGF)
A note out of Macquarie reveals that its analysts have upgraded this annuities company's shares to an outperform rating with a $7.00 price target. This follows news that Apollo has sold down its stake in Challenger from 20% to 9.9%. Macquarie suspects that the remaining stake will soon be sold as well. However, it isn't concerned. In fact, quite the opposite. The broker believes that the selloff that followed the Apollo news has created a buying opportunity for investors. Particularly given that Challenger's fundamentals remain firmly intact and the strategic partnership between it and Apollo will continue as normal. The Challenger share price is fetching $6.20 at the time of writing.
REA Group Ltd (ASX: REA)
Analysts at Bell Potter have retained their buy rating on this property listings company's shares with an improved price target of $226.00. According to the note, the broker believes that REA Group's potential acquisition of UK-based Rightmove (LSE: RMV) is logical at a headline level. It highlights that using expensive REA Group equity to purchase cheap Rightmove equity (both compared to long term averages) could be a smart move. And based on a 30% takeover premium and 5% net synergies, it believes the deal would be 12% earnings per share accretive by FY 2026. Bell Potter also revealed that it recognises potential to further leverage a significant equity base to create a diversified global property listings network. The REA Group share price is trading at $201.95 on Monday.
