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:
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Catapult Sports Ltd (ASX: CAT)
According to a note out of Morgans, its analysts have retained their buy rating and $6.25 price target on this sports technology company's shares. Morgans has been busy updating its forecasts to incorporate the IMPECT and IsoLynx transactions. In addition, the broker is positive on the company due to its strong growth outlook. It has previously spoken about how it believes Catapult can grow its revenue by 20% per annum over the next three years to reach US$180 million by FY 2028. As a result, Morgans sees plenty of value on offer here and appears to see recent share price weakness as a buying opportunity. The Catapult share price ended the week at $3.37.
Magellan Financial Group Ltd (ASX: MFG)
Another note out of Morgans reveals that its analysts have upgraded this fund manager's shares to a buy rating with a $12.43 price target. The broker made the move after reviewing the company's plans to merge with Barrenjoey. Morgans thinks the deal makes strategic sense and believes it will reinvigorate the Magellan story. While the broker feels the deal pricing is tilted in Barrenjoey's favour, it still sees plenty to like here for Magellan shareholders. It notes that the merger fundamentally changes the company's overall outlook, strengthens the business, and provides additional pathways to growth. The Magellan share price was fetching $10.12 at Friday's close.
Zip Co Ltd (ASX: ZIP)
Analysts at Macquarie have retained their buy rating and $3.35 price target on this buy now pay later provider's shares. According to the note, the broker has been looking at Zip's business model and remains positive on its outlook. Macquarie thinks investors should look beyond Zip's moderating operating leverage and focus on its medium-term growth outlook. It is expecting Zip's U.S. net transaction margin to improve sequentially in both the March and June quarters. And while loan losses are rising relative to total transaction value, Macquarie highlights that this is because Zip is bringing on new users. Furthermore, management has the ability to quickly remove defaulters, boosting its loan loss metrics. The Zip share price was trading at $1.62 on Friday.
