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Top brokers name 3 ASX shares to sell next week

James Mickleboro
ASX shares to avoid

Once again, a large number of broker notes hit the wires last week. Some of these notes were positive and some were quite bearish.

Three sell ratings that caught my eye are summarised below. Here’s why top brokers think investors ought to sell these shares next week:

Commonwealth Bank of Australia (ASX: CBA)

Analysts at Morgan Stanley have retained their underweight rating and $70.00 price target on this banking giant’s shares. According to the note, the broker feels that the bank’s recent share price appreciation indicates that the market is expecting a strong half year result in February. Morgan Stanley appears concerned that a failure to deliver on this could put a lot of pressure on its shares. The broker is also expecting the bank to announce a $2 billion off-market share buyback and expects investors to be disappointed if this doesn’t materialise. The Commonwealth Bank share price ended the week at $84.94.

Medibank Private Ltd (ASX: MPL)

A note out of the Macquarie equities desk reveals that it has retained its underperform rating and $2.85 price target on this private health insurer’s shares. According to the note, the broker is concerned that Medibank’s margins could be squeezed meaningfully if its claims growth continues to rise. This could weigh heavily on its earnings. Medibank’s shares ended the week at $3.16.

Rio Tinto Limited (ASX: RIO)

According to a note out of Credit Suisse, its analysts have retained their underperform rating and lifted the price target on this mining giant’s shares to $94.00. Although the broker acknowledges that Rio Tinto had a solid December quarter and has increased its earnings estimates accordingly, it isn’t enough for a change of rating at this stage. Credit Suisse continues to believe that Rio Tinto’s shares are overvalued at the current level. The Rio Tinto share price last traded at $103.18.

The post Top brokers name 3 ASX shares to sell next week 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 has no position in any of the stocks mentioned. 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. 2020