It was 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:
Image source: Getty Images
Coles Group Ltd (ASX: COL)
According to a note out of Morgan Stanley, its analysts have upgraded this supermarket giant's shares to an overweight rating with an improved price target of $21.70. Morgan Stanley thinks that investors should be switching their focus to consumer staples from consumer discretionary stocks right now. This is due to current valuations. Outside this, the broker likes the supermarket giant due to its ongoing market share gains and strong ecommerce performance. It also highlights that Coles is closing the gap on its rival Woolworths Group Ltd (ASX: WOW) in respect to its margins. The Coles share price ended the week at $18.70.
Life360 Inc (ASX: 360)
A note out of Goldman Sachs reveals that its analysts have retained their buy rating and $27.00 price target on this location technology company's shares. The broker is urging investors to take advantage of recent share price weakness to pick up Life360's shares at a discount. This is particularly the case given that Goldman Sachs sees potential for FY 2025 earnings guidance upgrades from the company based on its historical outperformance. In addition, the broker highlights that it rates Life360 highly due to its positive long-term growth outlook, which is being supported by US and International Subscriptions, expansion of new channels, and the utilisation of additional hardware products to drive subscriptions. This includes the launch of pet devices in late 2025 and an elderly device. The Life360 share price was fetching $21.00 at Friday's close.
Seek Ltd (ASX: SEK)
Analysts at Bell Potter have initiated coverage on this job listings giant's shares with a buy rating and $27.00 price target. According to the note, the broker suspects that Seek is in a strong position to benefit from interest rate cuts. Its analysts highlight that this is because rate cuts usually boost the job market, which lifts job advertisement volumes. Combined with its new unified platform, Bell Potter believes that this could lead to an improvement in both yields and margins. As a result, the broker is forecasting strong earnings growth in the coming years. It has pencilled in an earnings per share compound annual growth rate of 19% between FY 2024 and FY 2028. The Seek share price ended the week at $22.65.
