scroll

Southern Cross Electrical Engineering Ltd (SXE) entry price

Advanced Search

Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.

Ask a question

The Latest Q&A

Question asked 28/03/2026

Southern Cross Electrical Engineering Ltd (SXE) entry price

Hi MM, I am a little confused by your ideal entry point of $2.60 on SXE in your commentary in your 25 March 2026 morning report. Given the stock’s chart/recent price action, $2.60 would represent a significant break of support/the price range over March, presumably accompanied by a negative development for the stock or a negative macro development, or both. In the absence of one or more of those developments, what leads you to expect a potential $2.60 entry, presumably in the short to medium term, particularly given your positive views on the stock? If MM cannot enter SXE at that price will it enter at higher price? Also, what will be the trigger (s) for MM to buy the stock as opposed to leaving it on the hitlist? Thanks, Darren

Answer

Hi Darren,

We discussed SXE in detail this week: Here.

SXE has evolved into a higher-quality, more diversified business with increasing exposure to recurring, higher-margin work, driving a re-rating to ~17.2x FY26 earnings (vs ~11x historically). With ~10% earnings growth, a strong net cash position, and ample liquidity, it remains well placed for further bolt-on acquisitions. While peers like NRW are larger and cheaper, SXE offers better leverage to structural electrification themes and higher-quality earnings, making it our preferred exposure.

All of the above combines to form your question, basically why not “buy now.”

The simple reason to flag an “ideal” entry around the $2.60 area is the number of spikes we are seeing on the downside on both the stock and sector front from war driven moves in gold miners to “AI disruption” in the Software stocks.

With Trump and Iran still exchanging words on this week, we simply hold a balanced view with regard to entry levels, i.e. we want to be prepared to buy panic not fret about the implications to our portfolios. In the case of SXE, a market driven rather than company specific issue could easily see it trade lower towards our ideal risk/reward entry.

We may “pay up” for SXE but will remain patient, at least in the short term.

chart

Southern Cross Electrical Engineering Ltd (SXE)

LAST UPDATED 26/03/2026 10:29

Latest Reports

Weekend report 28/03/2026

Weekend Q&A: Markets still fear the Iranian conflict has no end in sight

The ASX200 finished a choppy week up +1%, a solid result given the index gapped down ~2% on Monday. Volatility was elevated, with three sessions posting 100-point intraday swings—moves that would typically define a month. Geopolitics remain front of mind: the US and Israel struck Iranian nuclear and steel facilities on Friday, prompting retaliation across the Persian Gulf. The escalation followed President Trump's delay of a deadline for Tehran to reopen the Strait of Hormuz. Markets remain on edge, with Brent Crude above $US113 the key focus, the prolonged conflict is increasing the risk of more meaningful damage to the global economy.

Afternoon report 27/03/2026

The Match Out: ASX snaps 3 week losing streak, though nerves remain

The ASX 200 snapped a three-week losing streak, though there was little conviction around the local market today, with the index slipping mildly lower by the close – although it did recover ~50 points from the morning low as US Futures traded up.