Many of Australia's top brokers have been busy adjusting their financial models and recommendations again. This has led to the release of a number of broker notes this week.
Three ASX shares that brokers have named as buys this week are listed below. Here's why their analysts are feeling bullish on them right now:
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BHP Group Ltd (ASX: BHP)
According to a note out of Goldman Sachs, its analysts have retained their buy rating and $48.40 price target on this mining giant's shares. The broker believes the Big Australian's shares are attractively priced even though they trade at a premium to rival Rio Tinto Ltd (ASX: RIO). Goldman thinks this premium is justified due to its ongoing superior margins and operating performance, particularly in Pilbara iron ore where it maintains superior free cash flow per tonne compared to peers. In addition, the broker remains very positive on copper and met coal and likes the optionality of BHP's US$20 billion+ copper pipeline. The BHP share price is trading at $43.41 today.
Guzman Y Gomez Ltd (ASX: GYG)
A note out of Morgans reveals that its analysts have initiated coverage on this quick service restaurant operator's shares with an add rating and $30.80 price target. The broker is feeling positive about Guzman Y Gomez due to its strong long term growth potential and operating leverage. In respect to the former, the broker believes the company can achieve its aspirational target of 1,000 restaurants in Australia. This is by opening 30-40 restaurants each year. Though, it is worth noting that Guzman Y Gomez's shares are trading at approximately 400x estimated FY 2025 earnings based on Morgans' estimates. The Guzman Y Gomez share price is fetching $25.10 on Wednesday afternoon.
Liontown Resources Ltd (ASX: LTR)
Analysts at Bell Potter have retained their speculative buy rating and $1.85 price target on this lithium developer's shares. This follows news that the company has secured funding through a five-year US$250 million convertible note to LG Energy Solution. The broker believes the funding is a sensible solution to remove the onerous terms associated with traditional bank debt. In light of this, it thinks the company is fully funded to free cash flow. Outside this news, Bell Potter is very positive on the 100% owned Kathleen Valley lithium project. It notes that it remains highly strategic with initial production imminent, a long mine life, and tier-one location. The Liontown share price is trading at 93 cents this afternoon.
