Codan Limited (CDA) AI Stock Analysis

• Market Cap: AU$6.29B
• Dividend Yield: 0.97%
• Average Volume (3M): 387.50K
• Price to Earnings (P/E): 48.9
• Beta (1Y): 1.49
• Revenue Growth: 22.48%
• EPS Growth: 27.07%
• Country: AU
• Employees: 450
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 0.39
• Shares Outstanding: 181,875,320
• 10 Day Avg. Volume: 342,565
• 30 Day Avg. Volume: 387,502
• PEG Ratio: 1.33
• Price to Book (P/B): 6.99
• Price to Sales (P/S): 5.43
• P/FCF Ratio: 26.55
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: AU$38.95
• Price Target Upside: 13.35% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): 0.84
• Revenue Forecast (FY): AU$829.56M

• Rating: 71 Outperform
• Price Target: AU$38.00 ▲(10.59% Upside)
• Action: Reiterated Date: 02/19/26
• Date: Action: Reiterated 02/19/26

The score is driven primarily by strong financial performance and an upbeat earnings update with clear growth guidance and improving order book visibility. This is partly offset by expensive valuation (high P/E, low yield) and only moderate technical momentum (below the 20-day average with slightly negative MACD).

Positive Factors

Strong top-line and profit growth

Sustained double-digit revenue growth and large operating leverage (EBIT +52%, NPAT +55%) indicate durable product demand and scalable cost structure. This underpins multi-period earnings visibility, supports reinvestment in R&D and channels, and strengthens long-term cash generation.

Robust free cash flow conversion

High free cash flow growth and near‑unity conversion of earnings to cash provide structural financial flexibility. Durable cash generation funds capex, R&D (engineering spend ~9% of revenue), dividends and selective M&A without materially increasing leverage over time.

Conservative leverage and liquidity headroom

Low reported leverage and substantial undrawn facilities give the company durable balance sheet optionality. This supports cyclical resilience, disciplined M&A capability and funding for product development, reducing refinancing and liquidity risk over the medium term.

Negative Factors

Rising operating expenses

Elevated operating spend for integration, launches and performance-linked pay can compress margins for multiple quarters. If cost synergies from acquisitions and shared services take longer to realize, profitability expansion may be delayed and cash conversion could be intermittently pressured.

Procurement softness in Zetron Americas

Structural variability in public sector procurement can lengthen sales cycles and create uneven revenue recognition for mission‑critical communications. Prolonged softness would weaken visibility on bookings and limit predictable revenue growth in a key market over several reporting periods.

Communications margin progression risk

The Communications segment's margin shortfall versus the 30% target highlights execution and scale risk. Failure to achieve margin expansion through integration and operational improvements would constrain group profitability gains and reduce the leverage from higher revenue.

Codan Limited Business Overview & Revenue Model

Company Description

Codan Limited develops technology solutions for United Nations organizations, mining companies, security and military groups, government departments, individuals, and small-scale miners. It operates through Communications and Metal Detection segments. The Communications segment designs, develops, manufactures, and markets communication equipment that consists of MIMO MESH; DTC radio solutions for the wireless transmission of video and other data applications; and Zetron communications solutions. The Metal Detection segment designs, develops, manufactures, and markets metal detection equipment, such as handheld metal detecting technologies for recreational, gold mining, demining, and military markets. The company sells its products through a network of dealers, distributors, and agents in Australia, Canada, Denmark, the United Kingdom, the United States, Brazil, India, Ireland, Mexico, Singapore, the United Arab Emirates, and internationally. Codan Limited was incorporated in 1959 and is headquartered in Mawson Lakes, Australia.

How the Company Makes Money

Codan Limited generates revenue through multiple key streams, including the sale of its communication systems, tracking solutions, and metal detection equipment. The Communications division, which includes tactical radio systems for defense and public safety agencies, represents a significant portion of the company's revenue, often enhanced by government contracts and international sales. The Tracking division offers asset tracking solutions for various industries, contributing to recurring revenue through service and maintenance agreements. Additionally, the Metal Detection division, popular among recreational and professional gold prospectors, generates income from both product sales and aftermarket services. Codan also benefits from strategic partnerships with government agencies and private sector clients, which help secure long-term contracts and projects. Overall, the combination of product sales, service agreements, and strategic collaborations underpins Codan's financial performance.

Codan Limited Financial Statement Overview

Summary

Strong overall financial health: solid revenue growth, healthy profitability, and robust free cash flow growth. Balance sheet leverage is manageable, though rising debt and some margin/cost pressure warrant monitoring.

Income Statement

Codan Limited has demonstrated strong revenue growth with a 14.25% increase in the latest year, indicating robust demand for its products. The company maintains healthy profitability with a gross profit margin of 56.18% and a net profit margin of 15.35%. EBIT and EBITDA margins are also solid at 21.74% and 23.08%, respectively, reflecting efficient operations. However, the slight decline in EBITDA margin compared to the previous year suggests potential cost pressures.

Balance Sheet

The balance sheet of Codan Limited is stable, with a manageable debt-to-equity ratio of 0.31, indicating prudent leverage. The return on equity stands at 19.76%, showcasing effective utilization of shareholder funds. The equity ratio is healthy, suggesting a strong capital structure. However, the increase in total debt over the years requires monitoring to ensure it remains sustainable.

Cash Flow

Codan Limited's cash flow is robust, with a significant 45.34% growth in free cash flow, highlighting strong cash generation capabilities. The operating cash flow to net income ratio of 0.76 and free cash flow to net income ratio of 0.94 indicate efficient conversion of earnings into cash. The company has improved its free cash flow position significantly, which is a positive sign for future investments and debt servicing.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	762.12M	674.23M	550.46M	456.47M	506.14M	437.05M
Gross Profit	412.57M	378.75M	305.23M	218.59M	253.06M	216.90M
EBITDA	185.43M	155.64M	147.10M	120.64M	162.65M	159.32M
Net Income	128.62M	103.49M	81.39M	67.77M	100.74M	90.35M
Balance Sheet
Total Assets	912.27M	904.80M	768.71M	693.30M	590.93M	502.85M
Cash, Cash Equivalents and Short-Term Investments	21.78M	39.73M	19.70M	23.66M	22.61M	22.36M
Total Debt	184.06M	160.74M	141.05M	125.39M	82.24M	56.12M
Total Liabilities	354.38M	380.98M	321.78M	286.97M	222.98M	199.24M
Stockholders Equity	557.89M	523.83M	447.39M	406.70M	368.28M	303.72M
Cash Flow
Free Cash Flow	49.20M	138.02M	55.67M	30.51M	17.56M	108.35M
Operating Cash Flow	53.98M	146.64M	106.45M	79.88M	51.72M	131.30M
Investing Cash Flow	-30.66M	-98.06M	-87.96M	-53.93M	-19.75M	-182.72M
Financing Cash Flow	-40.77M	-28.66M	-22.43M	-25.45M	-32.68M	-19.00M

Codan Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 34.36
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:CDA, the sentiment is Positive. The current price of 34.36 is below the 20-day moving average (MA) of 35.56, above the 50-day MA of 33.90, and above the 200-day MA of 27.95, indicating a neutral trend. The MACD of -0.24 indicates Positive momentum. The RSI at 44.89 is Neutral, neither overbought nor oversold. The STOCH value of 47.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:CDA.

Codan Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DDR	76 Outperform	AU$1.83B	22.14	33.65%	4.29%	8.70%	3.11%
CDA	71 Outperform	AU$6.29B	48.88	20.83%	0.97%	22.48%	27.07%
XRF	67 Neutral	AU$244.52M	22.74	18.05%	2.31%	-1.09%	14.88%
OCL	65 Neutral	AU$1.24B	34.76	35.71%	1.27%	5.11%	12.91%
DRO	64 Neutral	AU$2.77B	847.50	2.19%	―	61.31%	-34.15%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
ZMM	37 Underperform	AU$4.54M	-2.56	-283.40%	―	-74.76%	42.11%

Codan Limited Corporate Events

Codan Sets Date for H1 FY26 Results and Investor Webinar

Codan Limited has announced that it will release its financial results for the half year ended 31 December 2025 on Thursday, 19 February 2026. The company will host a same-day investor webinar led by CEO and Managing Director Alf Ianniello and CFO and Company Secretary Michael Barton, providing the market with an opportunity to hear management’s commentary on performance and outlook, underscoring Codan’s ongoing engagement with investors and other stakeholders.

The most recent analyst rating on (AU:CDA) stock is a Hold with a A$38.75 price target. To see the full list of analyst forecasts on Codan Limited stock, see the AU:CDA Stock Forecast page.

Codan Flags Strong FY26 First-Half on Metal Detection and Communications Growth

Codan Limited has flagged a strong first half for FY26, guiding to preliminary group revenue of about $394 million, up 29% year on year, and underlying net profit after tax of at least $70 million, a 52% increase, driven by standout performance in metal detection and continued strength in communications. Metal detection revenue is expected to reach roughly $168 million, up around 46% on the back of robust gold detector demand in Africa and double‑digit growth in recreational markets, while the communications segment is set to deliver about $222 million in revenue, a 19% rise that aligns with the upper end of Codan’s targeted growth range, underscoring the company’s momentum across both divisions ahead of its detailed results release in February 2026.

The most recent analyst rating on (AU:CDA) stock is a Hold with a A$32.00 price target. To see the full list of analyst forecasts on Codan Limited stock, see the AU:CDA Stock Forecast page.