Azzet reports on three ASX stocks with price moving updates today.
Treasury Wines tumbles after pulling guidance ~
Treasury Wines Estate (ASX: TWE) was the ASX’s biggest loser today, down around 14% by 2:30 pm AEDT (3:30 am GMT), after the Penfolds owner surprised the market by downgrading earnings guidance and staunching its previously announced $200 million share buyback.
Before incoming CEO Sam Fischer takes up his new late October, the company withdrew the previous guidance for Penfolds of low-to-mid double-digit growth in earnings for 2025-26, and around 15% earnings growth in 2026-27 on the back of weaker-than-expected trading at Penfolds in China.
Despite strong fundamentals and a flexible and diversified global sales model, the winemaker told the market today it is no longer in a position to provide revised guidance at this time after citing challenges in key markets China and the U.S.
What’s surprising today is the magnitude of the share price fall, given that the market has known about the trading headwinds in China and, to a lesser extent, the U.S. for some time.
Back in June, analysts had also raised concerns over a slowdown in earnings for its luxury brand Penfolds, dwindling wine consumption in the U.S. and weakness across its large portfolio of cheap, commercial bottles.
Two months later, the winemaker told the market there had been softness in depletions in China throughout June and July due to evolving consumption dynamics within the alcohol sector, with large-scale banqueting events taking a notable hit.
While Penfolds' 1Q26 shipments matched expectations globally, Penfolds' depletions in China, a critical market, remain subdued despite some improvement around the Mid-Autumn Festival, with full data still pending.
Assuming the current trends persist, Penfolds told the market it is unlikely to meet its China depletions targets for the year.
However, management is implementing several plans to mitigate the China, including the reallocation of products to other key markets while being careful to avoid grey imports back into China.
Meantime, despite the winemaker’s America’s portfolio performing relatively well, shipments to this market have been impacted by the distribution transition in California.
Following the decision by the incumbent distributor in California, Republic National Distribution (RNDC), to close its operations in the state last month, there are ongoing negotiations between the group and RNDC on reaching a practical solution.
High on the agenda will be the treatment of the remaining inventory ($100 million net sales revenue) held by RNDC in California.
Meanwhile, the group has paused the outstanding $170 million buyback of the $200 million buyback announced in August until there’s greater clarity around trading conditions and expectations.
Unsurprisingly, the group also refrained from providing updated guidance for FY26 at this stage.
Key numbers reported today:
What did Treasury Wine Estates report?
- Treasury Americas' portfolio outside California grew depletions over 5% (ex-California).
- U.S results were hampered by Californian distributor changes.
- Treasury Collective performed in line in Australia and EMEA.
- Strong capital position: $1.0 billion liquidity and solid financial covenants headroom.
Look out for greater insights at the group’s AGM, scheduled for 16 October, into how it expects to navigate ongoing disruptions.
The stock’s share price has been bouncing lower for some time, and it is down around 50% in the past year and down 20% in the past month.
Treasury Wine Estates has a market cap of $4.9 billion.
The stock’s shares appear to be in a long-term bearish trend, confirmed by multiple indicators.
Consensus is Moderate Buy.
Back in June, JP Morgan cut its 12-month target price from $11.50 to $10.20, reflecting further earnings risk, but maintained its ‘overweight’ given the current P/E discount.
Morgan Stanley dropped its share price target from $12 to $10.75.
Toro Energy rockets on Canadian uranium firm buyout plans
Shares in Toro Energy (ASX: TOE) were trading 35.4% higher following revelations that IsoEnergy (NYSE American: ISOU; TSX: ISO), a Canadian uranium company, plans to acquire all outstanding shares of WA-based uranium small cap.
The $75 million offer represents an 80% premium to Toro’s closing price of 32.5 cents on the ASX last Friday.
Based on the agreed exchange ratio, the deal values Toro shares at 58.4 Australian cents per share.
It’s understood that Toro Energy shareholders will receive 0.036 of an IsoEnergy common share for each Toro share held.
What appears to have attracted IsoEnergy to Toro Energy is the Australian uranium explorer’s fully owned Wiluna uranium project - located 30km south of the town of Wiluna in the northern goldfields of WA - which strengthens its portfolio of uranium assets.
The combination of IsoEnergy’s resources and Toro’s Wiluna project is expected to create a stronger entity with enhanced growth potential in the uranium sector.
On the flipside, Toro shareholders gain exposure to a larger, more diversified portfolio of high-quality uranium exploration, development and near-term production assets in tier-one jurisdictions in an enlarged, liquid vehicle while retaining direct exposure to the Wiluna Uranium Project and all other Toro assets.
Commenting on today’s announcement, Philip Williams, CEO of IsoEnergy, told the market that the acquisition of Toro Energy marks another important step in advancing its strategy to build a globally diversified, development-ready uranium platform.
“This transaction positions IsoEnergy to deliver meaningful scale, optionality, and sustained value creation for shareholders. We look forward to welcoming the Toro team, who have done an admirable job stewarding the company and its projects through often challenging markets, to IsoEnergy and advancing the project together.”
Toro Energy has a market cap of $54 million; the share price is up 73% in one year and up 25% over the last week.
The stock appears to be in a strong bullish trend, confirmed by multiple indicators.
Consensus does not cover this stock.
Fletcher Building slides on underwhelming trading update
Shares in Fletcher Building (ASX: FBU) were around 2.6% lower following a trading update in which the Australian and NZ building products group flagged a material contraction in its heavy building materials volumes.
Within today’s trading update, the company revealed, A) light building products volumes fell in the first quarter of FY25-26 compared with the previous year, while margins remained stable, and B) heavy building materials volumes had a big fall, with margins further declining.
Management cited weak demand across key markets and heightened competitive activity, especially in the NZ market.
“This has resulted in a further tough quarter for the business,” said CEO Andrew Reding.
“The market remains highly competitive, as demand stays low, particularly across the residential and infrastructure sectors.”
In response to the challenging market conditions, Fletcher Building is implementing a major cost-cutting program.
The company expects NZ$50 million ($44 million) in benefits in the second half of FY25-26 from its NZ$100 million cost-cutting programme – focussed on back-office operations and efficiencies - in response to the deteriorating market conditions.
The company anticipates full annualised savings to be achieved in 2026-27.
Despite the current challenges, management is focusing on cash preservation and cost control, with recent interest rate cuts potentially aiding the housing market, though market recovery timing remains uncertain.
Divisional Volume updates:
Light Building Products: Volumes were generally below the prior corresponding period (pcp), but slightly higher compared to Q4 FY25.
Positive volume growth was seen in Comfortech (+3.8% pcp) and Iplex NZ (+14.1% pcp).
In Australia, while volumes were down substantially on pcp, both Laminex AU and Iplex AU saw positive performance versus Q4 FY25.
Heavy Building Materials: Experienced some pronounced volume contractions.
Winstone Aggregates volumes fell 4.1% versus Q4 FY25 and 6.3% versus pcp, reflecting weaker roading and project activity.
Both Firth and Golden Bay have so far experienced volumes broadly in line with last year.
Steel volumes were marginally up on Q4 FY25 (and higher vs pcp), but margins have compressed further in the quarter.
Distribution Division, PlaceMakers Frame & Truss: Volumes were flat to marginally higher on pcp; however, margins contracted owing to competitive trading conditions.
Residential: Took 88 residential and apartment units to profit in Q1 FY26, compared to 90 in Q1 FY25.
Overheads continue to be tightly managed to mitigate the impact of historically low sales volumes amid elevated market inventories.
Fletcher Building has a market cap of $3 billion; the share price is trading flat over one year and is down 8% in the last week.
The stock appears to be in a long-term uptrend, confirmed by multiple indicators.
Consensus is Hold.
This article does not constitute financial or product advice. You should consider independent advice before making financial decisions.
