Analysts warn that these popular ASX shares as sells

It can be just as important to know which ASX shares to avoid as it is to know which ones to own when you are aiming to outperform the market. 

After all, if you own shares that are likely to fall in value, your portfolio returns could suffer. 

With that in mind, let's look at three ASX shares that analysts have named as sells this week, courtesy of The Bull. Here's what they are bearish on:

Bendigo and Adelaide Bank Ltd (ASX: BEN)

The team at MPC Markets believes this regional bank's shares are fully valued following a rebound.

In light of this and the weakening housing market, it thinks now could be a good time to take profit. It said:

In our view, the bank looks fully valued after its recent rebound, leaving little room for execution disappointments. Growth is modest, mortgage competition remains fierce and the shares already sit near analyst fair value estimates. 

The share price has been volatile, trading in a 52-week range between $9.81 and $13.11. The shares were trading at $10.225 on October 22. We would be inclined to cash in some gains in a weaker broader housing market.

Commonwealth Bank of Australia (ASX: CBA)

Shaw and Partners has named banking giant CBA as an ASX share to sell this week.

The broker believes its premium valuation, modest growth expectations, and competition and regulatory pressures are reasons to be cautious. It explains:

Commonwealth Bank continues to deliver a strong operational performance and remains Australia's highest quality banking franchise. However, the share price is trading at a significant premium to domestic and global banking peers. 

Earnings growth is expected to remain relatively modest, while competition and regulatory pressures persist across the banking sector. Given the elevated valuation and limited upside relative to risk, it may be prudent to realise gains and redeploy capital into investments with stronger growth prospects.

Transurban Group (ASX: TCL)

The team at Shaw and Partners is also bearish on toll road company Transurban.

It has named it as an ASX share to sell due to its belief that its valuation is stretched based on its growth expectations. The broker said:

Transurban owns a portfolio of quality toll road assets, but the current valuation appears stretched relative to expected growth, in our view. The business also carries significant debt, leaving it sensitive to funding costs and interest rate movements. 

While traffic volumes remain resilient, we believe future returns may be constrained by valuation and financing pressures. Investors may find more attractive opportunities elsewhere that offer stronger growth potential and a more suitable risk-reward profile.

The post Analysts warn that these popular ASX shares as sells appeared first on The Motley Fool Australia.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group. The Motley Fool Australia has positions in and has recommended Bendigo And Adelaide Bank and Transurban Group. 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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