On Thursday I picked out a few shares which brokers have given buy ratings to this week.
Today I thought I would look at the unlucky shares that have been given sell ratings. Here's why brokers think investors should stay clear of these three shares:
Newcrest Mining Limited (ASX: NCM)
According to a note out of Credit Suisse, its analysts have retained their underperform rating and $18.50 price target on the gold miner's shares. Although Newcrest has released a presentation relating to its tailings dam issue at the Cadia operation, it has still not provided an update to its full-year guidance. Analysts at Credit Suisse have made their own estimates and have reduced their earnings per share forecast to just 19.9 cents in FY 2018. As a comparison, the consensus estimate currently stands at around 66 cents per share. I would suggest investors follow Credit Suisse's advice and head to the exits before Newcrest upgrades it guidance. If it is as bad as the broker predicts then its shares could come crashing down.
Sandfire Resources NL (ASX: SFR)
Credit Suisse is also bearish on this copper producer. Despite raising its forecast for the copper price to US$3.09/lb in 2018 and US$2.60/lb in the first-half of 2019, the broker believes that Sandfire's shares are overvalued. As a result, it has downgraded Sandfire to an underperform rating with a raised price target of $6.10. OZ Minerals Limited (ASX: OZL) has also been downgraded to an underperform rating for the same reason. I'm not as bearish as Credit Suisse and think both companies could be worth a look.
TPG Telecom Ltd (ASX: TPM)
A note out of Citi reveals that its analysts have retained their sell rating and $5.20 price target on the telco company's shares ahead of its half-year results release next week. Although the broker believes that TPG Telecom will reaffirm its prior underlying EBITDA guidance of $800 million to $815 million for FY 2018, this isn't enough for it to change its recommendation. While I wouldn't necessarily be a seller of its shares, I wouldn't be a buyer unless they fell considerably from here.
