Colonial Motor Co Ltd (CMO) AI Stock Analysis

Colonial Motor Co Ltd

(NZX:CMO)

Select Model

Rating:57Neutral

Price Target:NZD 7.50▲(10.13% Upside)

Action:initiatedcoverage

Date:10/05/26

The overall score of 57 reflects a company with a solid balance sheet and attractive valuation, but significant operational headwinds. The most impactful factor is the sharp deterioration in profitability, with gross margins halving, which raises concerns about the sustainability of earnings. Positively, the low P/E and high dividend yield offer a margin of safety, and recent price momentum suggests improving market sentiment. The company's financial stability provides a buffer, but a recovery in margins is critical for a higher rating.

Positive Factors

Diversified franchise networkA broad franchise portfolio and national dealership footprint diversify CMC’s exposure across passenger vehicles, trucks, motorcycles and related markets. The additional JAC Motors distribution agreement could widen its addressable market and strengthen resilience as customer preferences and industry conditions evolve.

Negative Factors

Thin, inconsistent profitabilityPersistently thin and uneven margins leave limited room for execution errors, demand changes or cost pressure to be absorbed without affecting earnings. The decline from stronger 2022–2023 operating margins also suggests current profitability may be less durable until performance improves consistently.

Colonial Motor Co Ltd (CMO) vs. SPDR S&P 500 ETF (SPY)

Market Cap: NZD 230.50M
Dividend Yield: 6.91%
Average Volume (3M): 2,662
Price to Earnings (P/E): 11.9
Beta (1Y): 0.02
Revenue Growth: 6.89%
EPS Growth: 4.68%
Country: NZ
Employees: 1,066
Sector: General
Sector Strength: 55
Industry: Auto - Dealerships

Colonial Motor Co Ltd Business Overview & Revenue Model

Company Description

Colonial Motor Company Limited, along with its various subsidiary businesses, functions as a prominent operator of franchised automotive dealerships throughout New Zealand. The enterprise oversees twelve Ford vehicle outlets, seven of which simultane...

Colonial Motor Co Ltd Financial Statement Overview

Summary

Financial performance is mixed. The balance sheet is a relative strength with declining leverage (debt-to-equity of 0.48), but the income statement shows severe margin compression, with gross margins falling to 8.1% and net margins to 1.7%. Cash flow has improved operationally but free cash flow dropped to zero, indicating heavy reinvestment needs. Overall, financial stability is offset by weak and volatile profitability.

Income Statement

42Neutral

Balance Sheet

68Positive

Cash Flow

55Neutral

Financial statement breakdown
Breakdown	TTM	Jun 2026	Jun 2025	Jun 2024	Jun 2023	Jun 2022
Income Statement
Total Revenue	1.07B	1.07B	1.00B	1.01B	995.30M	999.03M
Gross Profit	86.34M	86.34M	193.45M	83.94M	91.38M	84.88M
EBITDA	44.63M	44.63M	50.97M	39.84M	62.52M	61.85M
Net Income	18.66M	18.66M	18.34M	4.54M	30.34M	33.34M
Balance Sheet
Total Assets	537.65M	537.65M	586.52M	598.54M	548.42M	458.21M
Cash, Cash Equivalents and Short-Term Investments	10.98M	10.98M	12.00M	11.47M	9.85M	12.79M
Total Debt	152.54M	152.54M	215.59M	104.51M	68.88M	36.51M
Total Liabilities	211.39M	211.39M	274.06M	296.98M	232.50M	150.37M
Stockholders Equity	320.48M	320.48M	306.98M	296.44M	310.77M	303.34M
Cash Flow
Free Cash Flow	85.94M	0	45.30M	-58.37M	-35.98M	43.10M
Operating Cash Flow	85.94M	85.94M	45.30M	-40.98M	-10.22M	67.25M
Investing Cash Flow	-5.86M	-5.86M	-11.67M	-16.12M	-24.93M	-22.52M
Financing Cash Flow	-81.09M	-81.09M	-33.11M	58.72M	33.16M	-47.63M

Colonial Motor Co Ltd Technical Analysis

Technical Analysis SentimentNegative

Last Price6.81

Price Trends

50DMA7.08Negative

100DMA6.94Negative

200DMA7.18Negative

Market Momentum

MACD-0.09Positive

RSI32.41Neutral

STOCH0.00Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NZ:CMO, the sentiment is Negative. The current price of 6.81 is below the 20-day moving average (MA) of 7.10, below the 50-day MA of 7.08, and below the 200-day MA of 7.18, indicating a bearish trend. The MACD of -0.09 indicates Positive momentum. The RSI at 32.41 is Neutral, neither overbought nor oversold. The STOCH value of 0.00 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NZ:CMO.

Colonial Motor Co Ltd Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

NZ:CMO against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NZ:CMO	57Neutral	NZD 222.65M	11.95	―	6.91%	6.89%	4.68%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
NZ:TRA	54Neutral	NZD 659.73M	17.38	12.23%	5.41%	9.03%	-2.47%

* General Sector Average

Performance Comparison

NZ:CMO and its peers over the selected period
Show on chart	Ticker	Company Name	Price	Change	% Change
	NZ:CMO	Colonial Motor Co Ltd	6.81	-0.81	-10.68%
	NZ:TRA	Turners Automotive Group Ltd	7.15	-0.28	-3.83%

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.

Date of analysis: Oct 05, 2026

Colonial Motor Co Ltd AI Stock Analysis