It has been an eventful couple of weeks on the market, so unsurprisingly brokers across the country have been busy adjusting their financial models and recommendations.
Three shares which found favour with brokers and were upgraded are listed below. Here's why these brokers think they are in the buy zone:
Independence Group NL (ASX: IGO)
A research note out of the equities desk at Macquarie reveals that its analysts have upgraded the miner to an outperform rating with a $4.10 price target. Macquarie's analysts appear to be pleased with the company's production guidance at its Nova site. Management recently advised that it expects Nova to hit full production during the first quarter. While I think Nova will prove to be a valuable asset for the company and it's a relief that there are no further delays, I'm not very bullish on gold and base metal prices moving forward. In light of this I would hold off an investment at this point in time.
TPG Telecom Ltd (ASX: TPM)
According to a note out of UBS, its analysts have slapped a buy rating and $6.70 price target on TPG Telecom's shares. They think the market has overreacted to the telco company's decision to launch its own mobile network and appear to believe it can win a greater share of the mobile market than investors are factoring in. I think UBS is spot on with its analysis and trust TPG Telecom to make a success of its foray into the mobile market. At under 15x trailing earnings I think its shares are a strong buy today.
Telstra Corporation Ltd (ASX: TLS)
Analysts at Deutsche Bank have upgraded Telstra's shares to a buy rating with a $4.51 price target. They believe Telstra's superior mobile network and market-leading position will mitigate the negative impact of TPG Telecom's decision to launch its own mobile network. Furthermore, following the sharp drop in its share price, they think that Telstra's shares are trading at a very appealing level. I agree with Deutsche and think Telstra is a great option right now. Even if it were forced to cut its dividend slightly to a more sustainable level, it would still be one of the most generous on the market.
