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Metcash Limited
(Sydney:MTS)
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Rating:59Neutral
Price Target:
AU$3.50
▲(15.89% Upside)
Action:Reiterated
Date:09/24/26
The score reflects stable but thin-margin financial performance and generally supportive valuation (low P/E and high dividend yield), partially offset by weak technical momentum (below major moving averages with negative MACD) and earnings-call headwinds including hardware margin pressure, tobacco-related impacts, and rising D&A and finance costs.
Positive Factors
Underlying revenue growth
Underlying revenue growth excluding tobacco indicates that Metcash is still expanding its core wholesale and distribution activity despite portfolio headwinds. Continued sales momentum supports network relevance, supplier scale, and operating leverage across food, liquor, and hardware over the next several quarters.
Negative Factors
Thin and volatile margins
Metcash operates with structurally thin profitability, so relatively small changes in gross margin can materially affect earnings. The sharp FY2026 margin decline highlights limited room to absorb cost inflation, competitive pressure, or weaker trading without reducing returns and cash available for investment.
Read all positive and negative factors
Positive Factors
Negative Factors
Underlying revenue growth
Underlying revenue growth excluding tobacco indicates that Metcash is still expanding its core wholesale and distribution activity despite portfolio headwinds. Continued sales momentum supports network relevance, supplier scale, and operating leverage across food, liquor, and hardware over the next several quarters.
Read all positive factors
Metcash Limited (MTS) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$3.45B
Dividend Yield5.73%
Average Volume (3M)3.70M
Price to Earnings (P/E)12.6
Beta (1Y)0.81
Revenue Growth0.18%
EPS Growth-1.74%
CountryAU
Employees14,000
SectorConsumer Defensive
Sector Strength42
IndustryFood Distribution
Share Statistics
EPS (TTM)0.25
Shares Outstanding1,099,726,200
10 Day Avg. Volume4,036,694
30 Day Avg. Volume3,695,131
Financial Highlights & Ratios
PEG Ratio-2.83
Price to Book (P/B)1.75
Price to Sales (P/S)0.17
P/FCF Ratio7.81
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$3.24Price Target Upside7.34% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)0.23
Revenue Forecast (FY)AU$17.77B
Metcash Limited Business Overview & Revenue Model
Company Description
Metcash Limited functions as a leading wholesale distribution and marketing enterprise with operations spanning both Australia and New Zealand. The company's activities are organized into three primary business units: Food, Liquor, and Hardware. I...
How the Company Makes Money
Metcash primarily makes money by acting as a wholesaler and distributor to independent retailers. Its core revenue stream is the sale of goods it sources from manufacturers and suppliers and then sells on to a large network of independently owned ...
Metcash Limited Earnings Call Summary
Earnings Call Date:Jun 21, 2026
(Q4-2026)
| Next Earnings Date:Dec 07, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly constructive picture: resilient underlying revenue growth (3.8% ex-tobacco), EBITDA expansion (3.5%), strong cash conversion (three-year cash realisation ~104%), and active strategic progress (Project Horizon, retail media partnership, retail ownership rollout). Offsetting these positives are notable cyclical and structural headwinds—hardware retail margins under pressure, the material decline in tobacco sales (AUD 1.8 billion lost revenue; ~AUD 25m earnings impact), an FY27 AUD 10m excise-related headwind, and rising depreciation and finance costs. Management emphasised disciplined capital allocation, cost savings actions, and platform resilience, suggesting the positives outweigh the negatives in the near term.Positive Updates
Revenue Growth (Excluding Tobacco)
Group revenue was AUD 19.6 billion, growing 3.8% excluding tobacco, demonstrating underlying top-line momentum across core businesses.
Negative Updates
Hardware Retail Margin Pressure
Hardware retail margins remain below mid-cycle targets due to weak trade/building activity (notably Victoria and Tasmania). While wholesale is stable, retail earnings are under pressure and overall Hardware EBIT is below desired levels.
Read all updates
Q4-2026 Updates
Positive
Negative
Revenue Growth (Excluding Tobacco)
Group revenue was AUD 19.6 billion, growing 3.8% excluding tobacco, demonstrating underlying top-line momentum across core businesses.
Read all positive updates
Company Guidance
Management guided that the group enters FY2027 from a position of strength after FY2026 revenue of AUD 19.6bn (up 3.8% excl. tobacco), EBITDA before strategy & integration of AUD 774m, operating cash flow of AUD 558m and a three‑year cash realization ratio of 104.2% (target 80–90%); leverage is around 1x with closing net debt AUD 616.6m and committed facilities of AUD 1.57bn (≈AUD 967m undrawn). For FY2027 they expect CapEx of ~AUD 150m (ex‑acquisitions), depreciation & amortization to increase by a low double‑digit percentage as Project Horizon assets come on stream, corporate costs of ~AUD 20–22m per half, net finance costs of ~AUD 130–135m, and Project Horizon’s first final deployment planned in Q4 2026 (with cost guidance unchanged if the second deployment proceeds safely). Capital management guidance included a total FY26 dividend of AUD 0.18/share (final AUD 0.095), ~74% payout ratio and suspension of the DRP; other noted metrics: ROFE ~20%, FY26 investment spend ~AUD 244m, FY26 CapEx AUD 175m, food EBIT AUD 261.8m (up 5.4%, margin 2.5% +14bps), hardware revenue (incl. charge‑through) AUD 3.7bn (+4.3%), an expected ~AUD 10m FY27 hit to food earnings from removal of the accelerated tobacco excise, and management targets AUD 25m of cost savings (AUD 15m people, AUD 10m procurement).Metcash Limited Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
55
Neutral
Cash Flow
58
Neutral
| Breakdown | Apr 2026 | Apr 2025 | Apr 2024 | Apr 2023 | Apr 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 17.35B | 17.32B | 15.91B | 15.80B | 15.16B |
| Gross Profit | 858.20M | 2.24B | 1.94B | 1.81B | 1.65B |
| EBITDA | 723.50M | 701.40M | 624.60M | 644.20M | 607.10M |
| Net Income | 279.10M | 283.30M | 257.20M | 259.00M | 245.40M |
Balance Sheet | |||||
| Total Assets | 7.00B | 6.89B | 5.80B | 5.38B | 5.20B |
| Cash, Cash Equivalents and Short-Term Investments | 67.20M | 87.30M | 97.30M | 89.50M | 104.70M |
| Total Debt | 1.90B | 1.89B | 1.41B | 1.49B | 1.32B |
| Total Liabilities | 5.27B | 5.26B | 4.27B | 4.29B | 4.11B |
| Stockholders Equity | 1.71B | 1.63B | 1.52B | 1.07B | 1.08B |
Cash Flow | |||||
| Free Cash Flow | 382.80M | 390.50M | 346.70M | 220.60M | 310.60M |
| Operating Cash Flow | 558.00M | 539.00M | 482.60M | 372.70M | 432.30M |
| Investing Cash Flow | -212.30M | -482.80M | -287.90M | -156.60M | -121.70M |
| Financing Cash Flow | -363.30M | -68.70M | -186.90M | -231.30M | -330.50M |
Metcash Limited Technical Analysis
Positive
3.02
Price Trends
2.96
Positive
2.98
Positive
2.98
Positive
Market Momentum
0.06
Negative
67.93
Neutral
77.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:MTS, the sentiment is Positive. The current price of 3.02 is above the 20-day moving average (MA) of 3.00, above the 50-day MA of 2.96, and above the 200-day MA of 2.98, indicating a bullish trend. The MACD of 0.06 indicates Negative momentum. The RSI at 67.93 is Neutral, neither overbought nor oversold. The STOCH value of 77.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:MTS.
Metcash Limited Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | AU$32.59B | 30.02 | 27.85% | 3.22% | 2.78% | 0.88% | |
63 Neutral | AU$1.95B | 35.76 | 5.46% | 2.28% | 6.66% | ― | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
59 Neutral | AU$3.45B | 12.62 | 16.56% | 5.73% | 0.18% | -1.74% | |
57 Neutral | AU$50.62B | 44.30 | 24.14% | 2.32% | 3.56% | 18.13% | |
57 Neutral | AU$4.80B | -4.38 | -29.99% | 3.61% | -12.18% | -347.47% | |
49 Neutral | AU$5.76B | 107.50 | 1.37% | 3.72% | 1.28% | -87.89% |
* Consumer Defensive Sector Average
AU:MTS
Metcash Limited
3.18
-0.45
-12.32%
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Metcash Limited Corporate Events
Metcash moves to bolster IGA network with Peries Group acquisition
Oct 19, 2026
Metcash has entered a binding agreement to acquire the Peries Group, a Queensland-based operator of 15 medium and large-format IGA supermarkets that generated about $264 million in retail sales in FY26 and employs around 1,000 people. The deal, tr...
Metcash issues new unquoted performance rights under employee incentive scheme
Oct 13, 2026
Metcash Limited has notified the market of the issue of 38,556 unquoted performance rights under its employee incentive scheme. The new rights, which are not intended to be quoted on the ASX, were issued on 9 October 2026 and reflect the company&#...
Metcash Notes Lapse of 35,962 Performance Rights in Capital Update
Oct 13, 2026
Metcash Limited has notified the market of a cessation of securities under its performance rights plan. The ASX filing confirms changes to the company’s issued capital, reflecting the lapse of conditional rights that did not meet required pe...
Metcash Reports Lapse of Performance Rights After Conditions Not Met
Oct 13, 2026
Metcash Limited, a major Australian wholesale and retail services group listed on the ASX, underpins independent supermarkets, liquor outlets, and hardware stores with supply, logistics, and merchandising support. The company operates across key c...
Metcash Reports Lapse of 2,134 Performance Rights
Oct 13, 2026
Metcash Limited has notified the market of the cessation of 2,134 performance rights, recorded under ASX code MTSAK, following a lapse of conditional rights that could not be satisfied. The rights, which ceased on July 30, 2026, represent a reduct...
Metcash boosts CEO Douglas Jones’s long-term equity incentive
Sep 16, 2026
Metcash has disclosed a change in the interests of Group CEO Douglas Jones, reflecting an updated allocation of equity-based incentives. Jones holds more than one million ordinary shares, mostly through family-related trusts and superannuation str...
Metcash Issues New Unquoted Performance Rights Under Incentive Scheme
Sep 16, 2026
Metcash Limited has issued 886,986 unquoted performance rights under its employee incentive scheme, with the securities not intended to be quoted on the ASX. The move underscores the group’s continued reliance on equity-based remuneration to...
Metcash Issues New Unquoted Performance Rights Under Incentive Scheme
Sep 16, 2026
Metcash Limited has notified the market of the issue of 26,890 unquoted performance rights under its employee incentive scheme. The securities, classified as performance rights with the ASX security code MTSAK, were issued on 29 August 2026 and ar...
Metcash Reports Lapse of Performance Rights
Sep 16, 2026
Metcash Limited has notified the market of the cessation of 33,390 performance rights, recorded under ASX security code MTSAK. The rights lapsed on August 20, 2026 after the conditional requirements attached to those securities were not met or bec...
Metcash Reports Lapse of 29,768 Performance Rights in Capital Update
Sep 16, 2026
Metcash Limited has notified the ASX of the cessation of a tranche of performance rights in its issued capital structure. The company reported that 29,768 MTSAK performance rights have lapsed after the conditions attached to those rights were not ...
Metcash shareholders back all resolutions at 2026 AGM
Sep 9, 2026
Metcash Limited reported that all resolutions put to shareholders at its 2026 annual general meeting were passed by the requisite majority on a poll. The voting outcomes, which showed strong levels of support across all items, were in line with th...
Metcash Delivers Resilient FY26 Results Amid Cost-of-Living Pressures
Sep 8, 2026
Metcash reported a resilient performance for FY26, with group revenue rising to $19.6 billion, up 0.7% overall and 3.8% excluding tobacco, underscoring the strength of its diversified portfolio and independent retail model. Group EBIT reached $503...
Metcash Director Marina Go Lifts Indirect Shareholding With On-Market Purchase
Aug 27, 2026
Metcash director Marina Simone Go has increased her indirect shareholding in the company through an on-market purchase executed on 25 August 2026. Acting via Citicorp Nominees on behalf of the Cbus Super Fund, of which she is a beneficiary, Go acq...
Metcash CEO adjusts equity holdings as long-term incentives vest
Aug 21, 2026
Metcash has disclosed a change in the security holdings of its Group CEO, Douglas Jones, following the vesting of long-term incentive awards. Jones received an allocation of 81,748 ordinary shares upon the vesting of an equivalent number of perfor...
Metcash Performance Rights Lapse After Vesting Conditions Not Met
Aug 20, 2026
Metcash Limited has disclosed the lapse of 1,257,658 performance rights (security code MTSAK), following the failure or incapacity of the conditions attached to those rights to be satisfied by 14 August 2026. The notification, lodged as an Appendi...
Metcash Reports Cessation of Performance Rights on ASX
Aug 20, 2026
Metcash Limited has notified the Australian Securities Exchange of the cessation of 48,964 performance rights, recorded under the security code MTSAK, effective 14 August 2026. The announcement, lodged as an Appendix 3H, reflects a change in the c...
Metcash Issues New Unquoted Performance Rights Under Staff Incentive Plan
Aug 14, 2026
Metcash Limited operates as a wholesale distribution and marketing company, best known for supplying groceries, liquor and hardware to independent retailers across Australia. Listed on the ASX under the code MTS, it plays a key role in supporting ...
Metcash Issues Over 4.3 Million Unquoted Performance Rights Under Incentive Scheme
Aug 14, 2026
Metcash Limited has notified the market of the issue of unquoted equity securities linked to its employee incentive arrangements. The company disclosed the creation of new performance rights that will not be quoted on the ASX, reinforcing its use ...
Metcash Reports Lapse of Performance Rights, Adjusting Issued Capital
Aug 14, 2026
Metcash Limited has notified the market of the lapse of 20,058 performance rights, recorded as MTSAK securities on the ASX, after the conditions attached to these rights were not met or became incapable of being satisfied. The cessation of these c...
Metcash Reports Lapse of 8,394 Performance Rights in ASX Filing
Aug 12, 2026
Metcash Limited has notified the market of the cessation of a parcel of performance rights, as disclosed in an Appendix 3H filing to the ASX. The company reported that 8,394 performance rights, under the MTSAK security description, have lapsed aft...
Metcash Reports Lapse of Performance Rights After Incentive Conditions Not Met
Aug 12, 2026
Metcash Limited has reported the cessation of 8,894 performance rights, identified under ASX security code MTSAK, following the lapse of conditional rights because the specified performance conditions were not met or became incapable of being sati...
Metcash Files 2026 Corporate Governance Statement with ASX
Aug 6, 2026
Metcash Limited has lodged its 2026 Appendix 4G and Corporate Governance Statement with the Australian Securities Exchange, in line with ASX Listing Rules. The governance statement for the financial year ended 30 April 2026 is available on the com...
Metcash publishes 2026 Annual Report for investors
Aug 6, 2026
Metcash Limited has released its 2026 Annual Report, complying with Australian Securities Exchange listing requirements and updating investors on its latest financial year. The report has been dispatched to shareholders who requested a printed cop...
Metcash sets 2026 AGM to vote on governance, remuneration and CEO incentives
Aug 6, 2026
Metcash Limited has called its 2026 Annual General Meeting for 9 September in Sydney, with shareholders invited to attend in person at the Wesley Conference Centre or follow proceedings via webcast. The company has released its AGM notice, explana...
Metcash Director Helen Nash Steps Down but Retains Shareholding
Aug 3, 2026
Metcash Limited has announced that non-executive director Helen Elizabeth Craig Nash ceased to be a director of the company on 31 July 2026. The final director’s interest notice lodged with the ASX records that she holds 60,145 fully paid or...
Metcash CEO Douglas Jones Receives Additional Performance Rights Under Equity Incentive Plan
Jul 23, 2026
Metcash Limited has disclosed a change in the securities held by Group CEO Douglas Jones, following the issue of additional performance rights under the company’s equity incentive plan. The filing, made in accordance with ASX listing rules, ...
Metcash Issues New Tranche of Unquoted Performance Rights Under Incentive Scheme
Jul 23, 2026
Metcash Limited has issued 155,162 unquoted performance rights under its employee incentive scheme, with the securities designated as MTSAK and issued on 16 July 2026. These performance rights are subject to transfer restrictions and will not be q...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.