Research notes

ARB’s FY26 result was better than feared, with NPAT +5% ahead of consensus and strengthening 2H margins solidifying confidence in a return to growth in FY27. 2H Aftermarket sales were weak (-8%; MorgansF -7.5%; consensus -2%) but expectedly resilient against a weaker NVS sales backdrop (ARB Index -14%). Gross margins (2H +420bps yoy), US growth (+13.5% USD; accelerating store-in-store rollout), OEM contract wins (x2), resilient order books (strong 2H), meaningful Toyota FY27 tailwinds and a net cash balance sheet (~A$48m) were key highlights. We are encouraged by an exceptionally resilient result, with ARB showing its quality, emerging from cyclical lows with meaningful FY27 tailwinds.

COL’s FY26 result was broadly in line with expectations, with Supermarkets the key highlight while Liquor remained soft. Despite a challenging operating environment due to ongoing cost-of-living pressures, geopolitical uncertainty and increasing regulatory complexity, COL continued to gain market share in Supermarkets with momentum building across its digital business. COL also outlined several initiatives to support its next phase of growth. Alongside the ongoing development of its VIC automated distribution centre, the company plans to accelerate investment in stores, online capacity and technology, while repositioning its liquor offering with a greater focus on supermarket co-locations and a more integrated food and drinks proposition. We adjust FY27/28/29F underlying EBIT by +1%/+2%/+2%. Our target price increases to $25.40 (from $24.60) and we maintain our ACCUMULATE rating.

THL's FY26 result was in line with its recently upgraded guidance. Underlying EBIT increased 17% and NPAT was up 34% on the pcp. THL reported a strong Rentals result, however vehicles sales and margins declined. We view the result as a strong outcome considering operating conditions were challenging. THL's FY27 outlook is mixed, however profit growth is targeted. Rental bookings are now recovering, but the earnings step-up flagged for FY27 has been pushed out. We have upgraded our forecasts. THL's result and outlook are somewhat overshadowed by corporate activity with two proposed offers and due diligence well underway. In our view, the current offers are too low and need to be lifted given THL’s earnings recovery and stronger balance sheet. We maintain a BUY rating with A$3.00 price target.

FY26 was strong with EBITDA +49% YoY and NPAT +60%. Management seemed comfortable talking up the outlook more generally - across iron ore, energy, gold, rare earths and lithium - however expectations for FY27 were tempered by framing it as a consolidation year. While we acknowledge that the 1H27 comp will be difficult (1H26 revenue +45% YoY), the key lead indicators suggest that strong growth will continue into FY27 and beyond, as the E&C order book has more than doubled YoY to nearly $1.2bn (from $570m at FY25). MND’s E&C business has never been better positioned to start the year and can capture more of the value chain during this development cycle (civils, NPI, fabrication), with the mega-projects still to be awarded (Nolans, P2000, Hemi and Mt Holland). We maintain our BUY recommendation. Target price unchanged at $35.80.

WDS delivered a 1H26 EBITDAX beat (+6%) and inline underlying NPAT result (+1%). Underlying NPAT of US$1,334m ~1% ahead of consensus and ~3% ahead of MorgansF, was driven by stronger realised pricing (+20% yoy) and trading activity. Costs were inside the ranges pre-announced with the Q2 report. The interim dividend of US57cps (+8% YoY) was held at an 80% payout of underlying NPAT despite gearing (20.6%) sitting marginally above the 10-20% target range. A H2 skew in production and realised prices will help, while management also announced a US$350m pa cost savings target from 2028. We maintain our HOLD rating and A$32.20 target price.

EMV's emu™ pivotal validation trial has surpassed key enrolment milestones across active US and Australian hospitals, supporting the pathway toward FDA De Novo clearance. EMV is preparing to add an acute ischaemia detection endpoint to the pivotal trial, which may broaden first-release clinical utility and commercial opportunity. The First Responder aeromedical feasibility and usability study with Royal Flying Doctor Service has been completed, with favourable feedback from flight nurses and patients in real-world operation. EMV remains well funded, with A$17.1m cash as at 30 June 2026 and A$4.6m of non-dilutive funding remaining under current grant programs.

TLX posted its 1H26 result, announcing revenue growth, market share gains and significant progress across clinical and regulatory milestones. TLX flagged that its strengthened balance sheet is enabling increased investment in late-stage programs, including ProstACT Global, market expansion opportunities within its precision medicine portfolio and manufacturing and supply chain capabilities. TLX completed refinancing of existing convertible bond structure, issuing US$600m of new convertible bonds, due 2031. TLX entered into a strategic collaboration with Regeneron to jointly develop and commercialise next generation radiopharmaceutical therapies.

We have updated our WRK model post the FY26 result. Off a low base, we have lowered our FY27F/FY28F EPS estimates by >10%, mainly reflecting slightly higher D&A expense assumptions. We published a detailed WRK update following the company's recent capital raising on 22 July, which included extensive disclosure around the FY26 result detail. This can be accessed through the following link: WRK - Capital raising and business update. We maintain our $0.12 target price and BUY recommendation.

Mixed result. Our key focus was whether 2H delivered the guided growth acceleration, it didn't, but trophon-only earnings confirmed the core business remains in excellent health regardless of the group-level miss and near-term OPEX requirements for the CORIS launch. Trophon's demonstrated EBIT growth ex-CORIS underwrites the thesis regardless of near-term CORIS spend, and the FY27 guidance step-down reads to us as front-loaded investment to land the launch properly, not any deterioration in the longer-term opportunity. We move to an ACCUMULATE (from BUY) with a TP of A$3.50 (was A$4.00).

We believe the commercial rollout has progressed further than the headline implant numbers suggest, but execution capacity has temporarily become a key variable. With 52 hospitals contracted, 30 activated and 90 physicians trained, management is now prioritising utilisation within existing accounts rather than adding more sites, an important transition from market access to proving repeatability and productivity. We view the recent A$150m capital raise as alleviating near-term funding concerns, while CMS’s NCD process, major health-system purchasing agreements and real-world safety data provide important building blocks for broader adoption. We reduce CY26 sales to reflect the slower near-term ramp but retain CY27-28 estimates, expecting the existing footprint to drive meaningful gains. Our DCF-based valuation moves to A$1.95, mainly on dilution from the capital raise. BUY.