Top brokers name 3 ASX shares to sell next week

Top brokers have named Zip Co Ltd (ASX:Z1P) and these ASX shares as sells for next week. Here's why they are bearish…

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

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

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)

According to a note out of UBS, its analysts have retained their sell rating and trimmed their price target on this medical device company's shares to NZ$22.65 (A$21.34). This follows the release of the company's full year results last week. Although the company delivered very strong profit growth, it still fell short of the broker's expectations. In addition to this, although management has not provided guidance for FY 2022, UBS is expecting a sharp decline in earnings due to COVID-19 tailwinds ending. Overall, it feels this makes the company's shares overvalued. The Fisher & Paykel Healthcare share price ended the week at A$27.47.

Magellan Financial Group Ltd (ASX: MFG)

A note out of Morgan Stanley reveals that its analysts have retained their underweight rating and $39.60 price target on this fund manager's shares. Morgan Stanley has been looking at the company's new retirement income product. While it believes the FuturePay product has a lot of potential and could support fund inflows, it will be capital intensive. In addition, it notes that the company's active ETFs are experiencing fund outflows. The Magellan share price was fetching $48.30 at the end of the week.

Zip Co Ltd (ASX: Z1P)

Analysts at UBS have retained their sell rating and cut their price target on this buy now pay later provider's shares to $5.60. According to the note, the broker has made its move on the belief that Zip's margins are under threat from increasing competition in the United States. This would be a disappointment given the higher margins its QuadPay business enjoys. It also suspects that a major US bank could enter the market in the future like Commonwealth Bank of Australia (ASX: CBA) has in Australia. The Zip share price ended the week at $7.19.

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Broker Notes

woman holding 'hiring' sign in shop
Broker Notes

Can you guess whether Macquarie prefers REA Group, CAR Group or SEEK shares?

Which ASX online classifieds business offers the best investment opportunity today?

Read more »

Female miner smiling in front of a mining vehicle as the Pilbara Minerals share price rises
Broker Notes

Expert says this ASX All Ords small cap mining stock could rocket 38%

Big upside ahead?

Read more »

Two laughing young women hold shopping bags and ride an escalator up to another level in a Scentre Group shopping centre.
Broker Notes

3 ASX consumer sector shares to buy in July: expert

A leading expert has named its top 3 picks.

Read more »

Man drawing an upward line on a bar graph symbolising a rising share price.
Broker Notes

Broker says WiseTech shares can hit $135

Bell Potter has good things to say about this rebounding tech stock.

Read more »

a man holds a firework sparkler in both hands as a shower of sparkly confetti falls from the sky around him as he smiles and closes his eyes in a celebratory scene.
Broker Notes

Stock market outlook: Macquarie 'ready to party like its 1999'

It may not be too late to invest in the share market according to the broker.

Read more »

A woman wearing dark clothing and sporting a few tattoos and piercings holds a phone and a takeaway coffee cup as she strolls under the Sydney Harbour Bridge which looms in the background.
Broker Notes

The smartest Australian stocks to buy with $400 right now

Let's see why these shares are highly rated by brokers.

Read more »

person with large headphones looking puzzled holding their hand to their chin.
Broker Notes

Does Macquarie prefer Harvey Norman or JB Hi-Fi shares?

Both companies have market-beating long-term track records.

Read more »

A young man sits at his desk with a laptop and documents with a gas heater visible behind him as though he is considering the information in front of him. about the BHP share price
Broker Notes

Leading broker has just downgraded BHP shares. Is it time to sell?

Macquarie sees little upside. But why?

Read more »