Top brokers name 3 ASX shares to buy next week

It was a busy week for Australia's top brokers. This has led to a number of broker notes being released. 

Three broker buy ratings that you might want to know more about are summarised below. Here's why brokers think these ASX shares are in the buy zone:

Guzman Y Gomez Ltd (ASX: GYG)

According to a note out of Morgans, its analysts have upgraded this quick service restaurant operator's shares to a buy rating with a $31.00 price target. The broker has been looking at recent industry data and notes that consumer spending has been soft, particularly at the low income side of the market. And with interest rates potentially heading higher from here, the broker concedes that the industry outlook is challenging. Nevertheless, it feels that this is more than priced into Guzman Y Gomez shares at current levels following recent weakness. As a result, the broker feels now could be an opportune time to invest. The Guzman Y Gomez share price ended the week at $25.61.

Lovisa Holdings Ltd (ASX: LOV)

A note out of Bell Potter reveals that its analysts have upgraded this fashion jewellery retailer's shares to a buy rating with a $27.00 price target. Bell Potter has been looking ahead to the company's annual general meeting in November. The broker highlights its belief that Lovisa will experience relatively easier comparables and retain most of the growth reported at the start of FY 2027 when it provides its trading update. It notes that this will be supported by the fact that around 80% of revenue occurs outside Australia. The exit of a key competitor should also provide further support and offset risks in the local market. In light of this and recent share price weakness, the broker sees the current valuation as attractive. The Lovisa share price was fetching $22.62 at Friday's close.

Megaport Ltd (ASX: MP1)

Analysts at Citi have retained their buy rating and $24.60 price target on this network solutions company's shares. According to the note, the broker believes Megaport is well-placed to continue benefiting from increased spending on artificial intelligence inference. In fact, Citi believes the only risk is executing on its strong compute pipeline. And with its strong balance sheet and attractive contract economics, the broker believes Megaport is positioned to pursue further contract wins. Though, it concedes that significant contracts could require another equity raising to fund. The Megaport share price was trading at $18.54 at the end of the week.

The post Top brokers name 3 ASX shares to buy next week appeared first on The Motley Fool Australia.

Citigroup is an advertising partner of Motley Fool Money. Motley Fool contributor James Mickleboro has positions in Lovisa and Megaport. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Lovisa and Megaport. The Motley Fool Australia has recommended Lovisa. 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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