Azzet reports on three large caps trading double-digits higher at the open after reporting updates today.
IDP Education soars after better-than-expected FY25 result
Shares in IDP Education (ASX: IEL) were 32.2% higher by 1:45 pm AEST (3:45 am GMT) despite the ASX’s fourth most shorted stock (14.23%) posting a 14% drop in revenue to $882.2 million for the 2024 financial year (FY25), with the crackdown on international students taking its toll on placement and testing volumes.
The spike in trading today may have something to do with the market reacting strongly to the better-than-expected results.
However, it may have also been accentuated by short sellers potentially rushing to buy back shares to limit their losses, which may have created additional upward pressure.
While this may have led to a "short squeeze", the share price may look somewhat different heading into the close.
One bright spot on today’s result was a final dividend of 5 cents per share, which, while down from last year's payout of 9 cents per share, was well above the 1 cent per share analysts were expecting.
Meanwhile, student placement volumes fell 29% and language testing volumes dropped 18%, while adjusted earnings came in at $119 million, down 48% yet remained within guidance.
Meanwhile, management tried to frame today’s result around policy restrictions across IDP’s four key destination markets, continuing to disrupt over two decades of sustained 6% annual growth in globally mobile students.
However, some of the share price upside today may also reflect the market’s approval of plans to respond to challenging industry conditions that are largely beyond its control.
In response to these headwinds, IDP told the market today it had commenced a multi-year transformation that is expected to see the company become a more efficient, technology-enabled business positioned to capture profitable growth.
Phase one of the transformation is expected to strengthen and simplify the business and deliver $25 million net reduction in the cost base in FY26, with one-off restructuring costs of $35 million - $45 million.
“As IDP moves into the next phase of the transformation, it will look to capture additional productivity and revenue benefits,” the company said.
Tennealle O’Shannessy, IDP's CEO, reminded the market that the growth drivers underpinning the international education market’s long-term growth trajectory have not changed.
This year’s focus, added O’Shannessy, has been on managing the business in the face of a dynamic operating environment with priorities including profitable revenue, ongoing commitment to quality and yield and cost discipline.
“Our disciplined execution in FY25 has built on our strong foundations for a multi-year transformation, one designed to build a stronger, more resilient and more profitable IDP for the future,” she said.
“Our balance sheet and cash generation provide us with the capacity to navigate current market conditions and to make the required investments for the future.”
She expects the transformation program to drive immediate operating and financial improvements in FY26 and deliver investment returns over the medium term.
Outlook
The company guided to FY26 adjusted earnings of $115 million - $125 million, based on FY26 market volumes down 20% - 30% versus FY25.
Within this context, IDP expects revenue outperformance driven by a focus on profitable growth and average yield improvements including:
- Student Placement average prices to grow high single to low double-digit percentages.
- English Language Testing average prices to grow at mid-single digit percentages.
- IDP Education has a market cap of $1.5 billion; the share price is down 63% in one year and up 18% in the last week.
The stock’s shares appear to be in a long-term bearish trend, confirmed by a falling 200-day moving average.
However, there are rallies occurring at shorter timeframes.
The 5-day moving average is above both the 20 and 50-day moving averages, which is bullish and means that investors see opportunity in this stock.
Consensus is Moderate Buy.
Eagers Automotive rallies after posting record revenue
Shares in Eagers Automotive (ASX: APE) were up 12.5% after Australia’s largest car dealership group declared a 19% jump in interim revenue to a record $6.5 billion, while lifting half-year net profit by 2.3% to $119 million.
The group is paying a 24 cent interim dividend on 1 October, which is flat compared to the previous period.
Eagers, which commands around 14% of the new vehicle market, told the market it was making outsized gains in the electric vehicle (EV) and hybrid vehicle market, and now claims to have around a third of this “New Energy Vehicle” segment.
Commenting on today’s result, CEO Keith Thornton said record revenue proves the company’s ability to leverage scale, the quality of OEM band partnerships to drive growth and outperform its peers.
Outlook
The company expects to continue to grow its market share and deliver further revenue growth beyond initial full-year expectations on the back of improving market conditions.
Looking forward, the company expects:
- To deliver a third consecutive year of material growth, with $1 billion in revenue growth achieved in the first half, and further growth forecast for the remainder of FY25.
- A resilient new car market is aided by improving market conditions.
- Sustainable net margins with improved contributions from ongoing integration and optimisation from recent large-scale acquisitions.
- The company’s strong financial position is underpinned by a substantial property portfolio and asset base, together with $1.07 billion of liquidity at 30 June 2025.
- Corporate debt net of cash on hand was $474.2 million, down from $813.1 million at 31 December 2024.
Since February this year, Eagers' share price has more than doubled to $25.45, with lower interest rates clearly benefiting the stock.
Back in May, Eagers ceased being the exclusive retailer for BYD in Australia despite locking in a new five-year deal to sell the fast-growing Chinese electric vehicle brand.
A month later, the company positioned itself to potentially buy more dealerships after selling the 5.7% stake in the listed salary packing company McMillan Shakespeare (ASX: MMS) that it bought two years earlier.
Earlier this month, the company announced a strategic alliance with Japanese multinational Mitsubishi Corporation, aiming to explore collaboration initiatives and business opportunities across the automotive and mobility sector.
Eagers expects the alliance to help accelerate growth opportunities domestically and internationally across the company's new vehicle dealership network and independent used car business.
Eagers has a market cap of $6.6 billion; the share price is up 157% in one year and up 17% in the last week.
The stock appears to be in a strong bullish trend confirmed by multiple indicators.
Consensus is Hold.
Dicker Data rallies on strong half-year result
Shares in Dicker Data (ASX: DDR) were up by as much as 10% after the IT hardware and software distributor lifted gross revenue 15.7% to $1.8 billion in the six months ended June 30 on the back of large-scale artificial intelligence deals.
However, as the morning went on, the stock struggled to hold onto that gain with profit-takers paring it back to 6.2% in early afternoon trading.
The company reported earnings of $75.4 million, up 9.4%, for the six months ended June 30, while net profit before tax was $56.6 million, up 11.4%.
Fiona Brown, the company’s executive chair, attributed the double-digit growth to the company’s ability to capitalise on emerging opportunities in the AI sector.
"Our focus remains on delivering long-term shareholder value by continuously adapting and tightening our go-to-market strategies to grow revenue, optimise product mix and drive efficiency," she said.
“Our execution across all segments was pleasing, with each key product category growing in the first half.”
Contributing to strong sales numbers were the company’s selection as supplier of technology for a new “AI factory” being built in Melbourne’s CBD, while Dicker Data is also a leading distributor of Microsoft’s AI assistant, Copilot, in Australia and NZ.
According to Microsoft data, it continued to lead the Australian device market in the first half of 2025, "with June marking the tenth consecutive month of growth in device sales for the company".
"While Q4, FY24 saw the Windows 10 refresh commence (single digit device growth), it since stepped-up to double digit growth in device sales through H1 FY25," the company said.
"This trend appears to be further accelerating, particularly as businesses in the enterprise, mid-market and heavily regulated segments mobilise ahead of the projected supply chain uncertainty that may result through the back end of this calendar year, and into 2026 as a result."
The company guided to FY25 gross revenue between $3.7 - $3.8 billion (up 10% – 13% vs FY24); and net operating profit before tax: between $120 – 124 million, reflecting 3.2% – 3.4% PBT margin.
At first blush Jarden analysts described the company’s FY25 guidance as positive, with the midpoint a slight upgrade to consensus, and the introduction of quantitative guidance for DDR should help reduce uncertainty.
"Net debt improving should also be well received,” the broker noted.
Jarden has an $11 per share price target on the stock, while Wilsons Advisory is also overweight on the stock, with an $11.07 price target.
"While it might still be a bit early in the cyclical upswing, we see the laptop refresh cycle, the upgrading of hardware relating to cloud and AI-workloads and the Microsoft Windows 10 'end of life' as opportunities for sales growth," Wilsons analysts said.
Dicker Data had a market cap of $1.6 billion; the share price is down 10% in one year and 2.3% in the last week.
The stock is in a strong bullish trend, confirmed by multiple indicators.
Consensus is Moderate Buy.
This article does not constitute financial or product advice. You should consider independent advice before making financial decisions.
