Plumbing products company Reece Limited (REH) retreated 13.2% to a new one-year low of $19.05 after it said sales were down 3% to $4.4 billion in the six months to December 31. The accompanying rhetoric didn’t improve the report’s disappointing look and feel. “Our performance for the first half reflects the challenging trading environment in both ANZ and the US as mortgage rates and affordability continue to create near-term headwinds in our sector,” – Peter Wilson, Chairman and CEO.
- 1H25 Sales revenue of $4.40bn was down 3% YoY, inline with expectations.
- However, profit for the first half of $180.9mn, was down 19%, compared to $223.6mn last year, and ~5% below consensus.
- An interim dividend of 6.5c was announced, down from 8c YoY and lower than hoped.
Analyst calls reflect undoubtedly challenging times ahead for REH: 7 Sells, 4 Holds, and 1 lone Buy. Negative sentiment will undoubtedly change, but this result will unlikely excite many in the short term.
- We see no reason to chase the stock currently, however, the time will come when headwinds become tailwinds, but it feels too early for now.
MM is neutral towards REH
Add To Hit List
