Global metals recycling and resource recovery company Sims has surged +56% through 2026 with this time the AI build-out being a driving factor, which we touched on when they upgraded earnings earlier in the year here. As is so often the case in both upgrade and downgrade cycles, things can repeat, and SGM lifted guidance again this month:
On the 17th June, SGM lifted its FY26 earnings guidance, citing continued strength in non-ferrous metals and improved ferrous trading conditions. The company now expects underlying EBIT of $420–435 million (up from $350–400 million), driven by a stronger second half in North America, although trading conditions in Australia and New Zealand remain subdued due to elevated Chinese steel exports. Interestingly, the announcement was met with a mixed reaction by analysts after the stock’s strong appreciation this year.
With bad surprises now unlikely following the latest upgrade, we may consider SGM if profit taking takes it down another 5-7%.
- We like the risk/reward towards SGM in the $26-27 area.
MM is bullish towards SGM around $28
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