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Top brokers name 3 ASX shares to sell today

James Mickleboro
ASX shares to avoid

On Wednesday I looked at three ASX shares that brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with them right now. Three that have just been given sell ratings are listed below. Here’s why these brokers are bearish on them:

A2 Milk Company Ltd (ASX: A2M)

According to a note out of Citi, its analysts have retained their sell rating but lifted the price target on this infant formula and fresh milk company’s shares to $12.30. Citi continues to believe that the market’s margin expectations for the future are too optimistic and a2 Milk will need to increase its investment greatly to grow in China. Another concern the broker has is the increasing competition in the a2 category in the country. The a2 Milk share price is trading flat at $13.85 today.

Medibank Private Ltd (ASX: MPL)

Analysts at Goldman Sachs have retained their sell rating and $2.68 price target on this private health insurance company’s shares. This follows the release of APRA private health insurance industry data for the September quarter. According to the note, the data shows that policyholder growth remains soft, while claims growth is picking up. It believes this is putting pressure on Medibank’s margins and doesn’t expect anything to change over the next couple of years. Medibank’s shares are down 2.5% to $3.09 on Thursday.

Technology One Limited (ASX: TNE)

A note out of UBS reveals that its analysts have retained their sell rating but lifted the price target on this enterprise software company’s shares to $7.25. According to the note, Technology One delivered a full year result ahead of its forecasts. However, the quality of its earnings was much lower than expected. And although it believes its outlook is positive, it isn’t enough to make a change to its rating. Technology One’s shares are currently changing hands at $8.80, which is 44x the broker’s earnings estimate for FY 2020.

The post Top brokers name 3 ASX shares to sell today appeared first on Motley Fool Australia.

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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 A2 Milk. 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.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019