Top brokers name 3 ASX shares to buy next week

Buy ASX shares

Last week saw a large number of broker notes hitting the wires once again. Three buy ratings that caught my eye are summarised below.

Here’s why brokers think investors ought to buy them next week:

Altium Limited (ASX: ALU)

A note out of the Macquarie equities desk reveals that its analysts have upgraded this printed circuit board design software company’s shares to an outperform rating with a $37.50 price target. Macquarie made the move after a sharp pullback in its share price over the last few weeks. It believes this has left them trading at an attractive level, especially given its strong medium term earnings growth potential. I think Macquarie is spot on and Altium would be a great long-term option.

Fortescue Metals Group Limited (ASX: FMG)

Another note out of the Macquarie equities desk reveals that its analysts have retained their outperform rating and $12.40 price target on Fortescue’s shares. According to the note, as with Altium, it believes the iron ore producer’s recent share price weakness is a buying opportunity. Especially given how iron ore prices have remained relatively steady during the global market selloff. Based on spot prices for the steel making ingredient, it estimates that Fortescue’s shares offer a FY 2021 free cash flow yield of ~20%. Which bodes well for shareholders, as the broker expects the majority of this to be returned through dividends. I agree with Macquarie and feel Fortescue would be a great option for investors looking for exposure to the resources sector.

Helloworld Travel Ltd (ASX: HLO)

According to a note out of Ord Minnett, its analysts have retained their buy rating but trimmed the price target on this travel company’s shares to $3.28. The broker was not surprised to see the company withdraw its guidance last week due to the coronavirus outbreak. However, it believes the market has oversold its shares and appears confident that Helloworld will bounce back in 2021 when trading conditions recover. Whilst I agree with Ord Minnett, I think there are even better option in the travel sector.

Looking for more buy rated shares? Here are five stocks which have been rated as buys and tipped for strong returns.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Helloworld Limited. The Motley Fool Australia owns shares of Altium. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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