Despite Christmas being a matter of days away, brokers across Australia are as busy as ever making buy and sell recommendations.
Three shares which have found favour with brokers this week and been given buy ratings are listed below. Here's why brokers like them:
Adairs Ltd (ASX: ADH)
According to a note out of UBS, its analysts have retained their buy rating and increased the price target on the homewares retailer's shares to $2.10 from $1.65. The broker's research indicates that trading has continued to be strong, leading to potential half-year sales growth of 7%. While I'm not a big fan of the company due to its recent underperformance, it is decidedly cheap at 10x estimated FY 2018 earnings. This could make it worth a look, especially if the broker's forecasts are accurate.
Domino's Pizza Enterprises Ltd. (ASX: DMP)
A note out of Morgan Stanley reveals that its analysts have retained their overweight rating and $53.00 price target on the pizza chain operator despite the problems exposed at Retail Food Group Limited (ASX: RFG). The broker believes that there are big differences between the two franchise models and that the recent weakness in Domino's share price only makes it more attractive. I would agree with Morgan Stanley on this one and think Domino's would be a great buy and hold investment.
Orocobre Ltd (ASX: ORE)
Analysts at Morgans have upgraded the lithium miner to an add rating with an increased price target of $6.84 following its recent pricing update. In that update Orocobre advised that prices for the next six months have increased 25% on the previous six months. Considering the last quarter saw prices of over US$11,000 per tonne, Morgans expects Orocobre to achieve US$13,750 per tonne in the next half and beyond. While I am a fan of the lithium miner and bullish on the industry in the long-term, I would class it as a hold at the moment on valuation grounds.
