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:
BHP Group Ltd (ASX: BHP)
According to a note out of Goldman Sachs, its analysts have retained their buy rating on this mining giant's shares with an improved price target of $47.40. This follows the release of an in-line half year result earlier this week. Goldman was particularly pleased with the performance of BHP's copper operations. It notes that it reported copper EBITDA ~6% above expectations on a cost beat at Escondida, Spence and South Australia. In light of this, the broker remains very positive on BHP and sees value in its shares at current levels. In fact, it highlights that its shares are currently trading at ~0.8x NAV and ~6x forward EBITDA, comfortably below 25-year averages. The BHP share price is trading at $41.07 on Wednesday afternoon.
Challenger Ltd (ASX: CGF)
A note out of Bell Potter reveals that its analysts have retained their buy rating on this annuities company's shares with a trimmed price target of $7.80. The broker believes that the market was wrong to sell off Challenger's shares on Tuesday following the release of its half year results. Especially given how the selling does not reflect the underlying/operating performance of the business, in terms of growth in new business, controlling costs or asset returns. In addition, it notes that management's outlook commentary was confident and its guidance was maintained. As a result, it thinks a buying opportunity has opened up for investors today. The Challenger share price is fetching $5.66 at the time of writing.
HMC Capital Ltd (ASX: HMC)
Another note out of Goldman Sachs reveals that its analysts have retained their buy rating on this diversified alternative asset manager's shares with an improved price target of $12.30. This follows the release of a very strong half year result from HMC Capital, which revealed earnings up significantly on the prior corresponding period and well ahead of consensus expectations. Goldman believes this result is evidence of HMC Capital's ability to continue to raise assets under management at an accelerated pace and in turn drive management fee growth. The HMC Capital share price is trading at $10.52 this afternoon.
