While it has been far quieter on the broker note front this month in comparison to August, there has still been a good number of notes hitting the wires.
Three shares that have been the subject of positive broker notes are listed below. Here’s why they have been declared as buys:
Australia and New Zealand Banking Group (ASX: ANZ)
According to a note out of Goldman Sachs, its analysts have retained their conviction buy rating and increased the price target on the bank’s shares to $33.01 after it announced that it will lift variable mortgage rates by 16 basis points. In light of these rate rises, the broker has increased its earnings per share estimates by 2% to 3% in FY 2019 and FY 2020. ANZ Bank remains Goldman’s favourite Australian bank due to its view that it is best positioned to deal with the slowing bank revenue environment due to cost cutting opportunities and lower bad debts. I would agree with Goldman that ANZ Bank is a buy.
Orocobre Limited (ASX: ORE)
Analysts at Deutsche Bank have retained their buy ratings but cut the price target on this lithium miner’s shares to $6.90 after it provided an update on the impact of export duties in Argentina. According to the note, the broker has adjusted its forecasts to account for the 8% duty, leading to a meaningful decline in profit expectations this year and next. However, it has only had a negligible impact on the broker’s valuation. While I do like Orocobre, I would like to see sustained improvements in lithium prices before making a move.
Telstra Corporation Ltd (ASX: TLS)
A note out of Morgans reveals that its analysts have retained their add rating and $3.50 price target on the telco giant’s shares after yesterday’s guidance revision. According to the note, the broker believes that the guidance revision is immaterial and continues to see Telstra’s shares as a buy. In addition to this, with no changes being made to its cash flow forecasts, the broker appears confident that the guidance change won’t impact this year’s dividend. It expects Telstra to pay a 17 cents per share dividend this year and next. I would class Telstra as a hold until it clarifies its dividend plans in the coming months.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.