Animal spirits are alive and kicking in the market with experts who predict more profits for the S&P / ASX 200 (Index: ^ AXJO) (ASX: XJO) index for the next few months at least.
The benchmark of the top 200 is recovering 0.8% to a new record as we approach closing thanks to the latest positive export data from China, an imminent trade agreement between the United States and China next week and the risk of war in the Middle East.
There are also expectations that the next season of reports from the United States and Australia will have more positive than negative news.
But at times like this, everyone thinks that the market is on a road that worries me. Maybe I’m getting old and grumpy. For those with a more optimistic inclination in the markets, here are the last three actions that got a “buy” from the main brokers.
Time for a toast
Those concerned that the latest data came from the USA. UU. Nielsen is bad news for him Treasury Wine Estates Ltd (ASX: TWE) The stock price should think again, according to UBS.
Nielsen’s figures imply greater weakness for the Treasury Wine business in the United States, but the broker is not worried as he believes the survey covers only 40% to 50% of the ASX company’s business in that market.
In addition, any softening in wine sales is already in the share price with UBS reiterating its “buy” recommendation and the target price of $ 20.50 to 12 months for the stock.
“We believe that the outlook for TWE is positive, with upward potential for FY22 + through new capacity, mergers and acquisitions and French expansion,” said the broker.
“Operate in 21x 1 year fwd PE with an annual 3-year annual yield rate of ~ 15%, which makes TWE one of the best rated premium alcohol companies worldwide.”
Battered but not defeated
Talk about controversial calls! Credit Suisse acknowledges that they faced Limited MPA (ASX: AMP) is worthy of a “superior performance” (or purchase) rating despite its many challenges arising from the Royal Hayne Commission.
Clients may be taking their money from the wealth manager for the benefit of other platform providers such as Netwealth Group Ltd (ASX: NWL) and Hub24 Ltd (ASX: HUB), but the drop in interest rates could tip the balance.
This is because Netwealth and Hub24 have greater exposure to the cash management fee (the rate they charge to customers who deposit cash capital). As the rates fall, the interest they earn is less than the administrative fee, so customers will lose money by keeping cash across the platforms unless providers lower their rate.
AMP is much less exposed to this problem and its low valuation (thanks to its fall in the price of the shares), means that the stock is a better buy in the eyes of Credit Suisse.
Meanwhile, investors wishing to benefit from a drought break (a matter of “when” instead of “yes”) will want to start positioning themselves in Elders Ltd (ASX: ELD), according to Bell Potter.
The price of ELD shares rose today more than 8% to $ 6.80 after the broker reiterated its call to “buy” to the stock with a 12-month target price of $ 8.15 per share.
“The fundamentals behind the livestock market when we enter 2020 are virtually identical to those of 2015,” said Bell Potter.
“When the rain returns, we expect an increase in material in livestock prices as stockholders compete with processors for a limited supply.
“While the price finally gives way to volume in a restocking event, our analysis of the 2014-16 cycle showed that the value of off cattle registered an increase of ~ 65% in a two-year window, despite the fact that volumes dropped ~ 20% over the same period. “
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Brendon Lau has no position in any of the actions mentioned. Motley Fool Australia’s parent company, Motley Fool Holdings Inc., owns shares of Hub24 Ltd. Motley Fool Australia owns shares and has recommended Treasury Wine Estates Limited. Motley Fool Australia owns Netwealth shares. Motley Fool Australia has recommended Elders Limited and Hub24 Ltd. Not all fools may have the same opinions, but we all believe that considering a wide range of ideas makes us better investors. The Motley Fool has a disclosure policy. This article contains only general investment advice (under AFSL 400691). Authorized by Scott Phillips.