Metcash Limited (MTS) AI Stock Analysis

• Market Cap: $4.30B
• Dividend Yield: 4.28%
• Average Volume (3M): 3.61M
• Price to Earnings (P/E): 15.1
• Beta (1Y): 0.54
• Revenue Growth: 4.04%
• EPS Growth: -14.50%
• Country: AU
• Employees: 9,000
• Sector: Consumer Defensive
• Sector Strength: 55
• Industry: Food Distribution
• EPS (TTM): 0.13
• Shares Outstanding: 1,098,581,800
• 10 Day Avg. Volume: 5,015,251
• 30 Day Avg. Volume: 3,605,613
• PEG Ratio: 1.82
• Price to Book (P/B): 3.51
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 17.07
• 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: $4.16
• Price Target Upside: 6.50% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

• Rating: 64 Neutral
• Price Target: ―

Metcash Limited demonstrates solid financial performance, with strong cash flow and efficient equity return. However, high leverage and cost management challenges pose risks. Technical indicators suggest potential short-term price weakness. The attractive valuation and high dividend yield offer positive long-term prospects.

Metcash Limited Business Overview & Revenue Model

Company Description

Metcash Limited (MTS) is an Australian conglomerate that operates in the wholesale distribution and marketing sector. The company is primarily involved in the distribution of food and other grocery items to independent retailers and smaller chains. Metcash services a network of independent grocery stores, liquor outlets, and hardware stores across Australia, providing them with a wide range of products, logistics support, and retail solutions. Its core sectors include food, liquor, and hardware, with key brands such as IGA, Cellarbrations, and Mitre 10 under its umbrella.

How the Company Makes Money

Metcash Limited generates revenue by functioning as a wholesale distributor to independent retailers in Australia. The company's primary revenue streams come from the sale of food and grocery products, liquor, and hardware supplies. Metcash purchases products in bulk from manufacturers and suppliers, which it then sells to retail partners at a markup. The company benefits from economies of scale, allowing it to offer competitive pricing to its retail customers. Additionally, Metcash supports its retail partners with marketing, merchandising, and logistics services, which further enhance its revenue. Significant partnerships with independent grocery stores and retail networks ensure a steady demand for its products and services, contributing to its earnings.

Metcash Limited Financial Statement Overview

Summary

Metcash Limited exhibits steady revenue growth with improving operational efficiency. While profitability margins are stable, the company faces cost management challenges. The balance sheet shows moderate leverage, with an improvement in equity returns. Strong cash flow generation enhances financial flexibility, supporting future growth and debt management.

Income Statement

Metcash Limited has shown consistent revenue growth over the past years, with a 0.69% increase from the previous year, indicating stability in sales. The gross profit margin decreased to 4.9% in the latest period, suggesting potential cost management challenges. The net profit margin slightly decreased to 1.62%, reflecting stable profitability. Additionally, the EBIT margin improved to 3.02%, while the EBITDA margin increased to 3.93%, showing improvement in operational efficiency.

Balance Sheet

The debt-to-equity ratio stands at 0.93, indicating a balanced mix of debt and equity, though slightly high for the industry, which could pose financial risks. Return on equity improved to 16.95%, demonstrating efficient use of equity capital. The equity ratio is 26.16%, highlighting moderate financial leverage, which may offer some stability but also indicates potential reliance on debt.

Cash Flow

Free cash flow grew by 57.12%, reflecting strong cash generation capability. The operating cash flow to net income ratio is 1.88, which is healthy, indicating efficient cash management. The free cash flow to net income ratio is 1.35, showing good conversion of earnings into cash flow, which supports potential reinvestment and debt repayment.

Breakdown	TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	16.55B	15.91B	15.80B	15.16B	14.32B	13.03B
Gross Profit	2.06B	1.94B	1.81B	1.65B	1.45B	1.29B
EBITDA	522.10M	624.60M	511.80M	467.70M	389.00M	212.70M
Net Income	258.00M	257.20M	259.00M	245.40M	239.00M	-56.80M
Balance Sheet
Total Assets	7.00B	5.80B	5.38B	5.20B	4.85B	4.70B
Cash, Cash Equivalents and Short-Term Investments	95.10M	97.30M	89.50M	104.70M	124.60M	276.60M
Total Debt	2.07B	1.41B	1.49B	1.32B	1.03B	1.07B
Total Liabilities	5.41B	4.27B	4.29B	4.11B	3.56B	3.32B
Stockholders Equity	1.58B	1.52B	1.07B	1.08B	1.28B	1.36B
Cash Flow
Free Cash Flow	279.20M	346.70M	220.60M	310.60M	389.90M	56.00M
Operating Cash Flow	428.90M	482.60M	372.70M	432.30M	475.50M	117.50M
Investing Cash Flow	-682.60M	-287.90M	-156.60M	-121.70M	-171.70M	-36.40M
Financing Cash Flow	251.90M	-186.90M	-231.30M	-330.50M	-454.30M	51.40M

Metcash Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.91
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

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 3.91 is above the 20-day moving average (MA) of 3.64, above the 50-day MA of 3.43, and above the 200-day MA of 3.24, indicating a bullish trend. The MACD of 0.15 indicates Negative momentum. The RSI at 73.47 is Negative, neither overbought nor oversold. The STOCH value of 87.96 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:MTS.

Metcash Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COL	77 Outperform	AU$27.93B	25.16	30.87%	3.55%	6.00%	4.02%
ING	76 Outperform	€1.32B	14.72	38.76%	9.53%	1.77%	-15.93%
WES	75 Outperform	$95.47B	36.72	30.35%	2.26%	3.04%	3.65%
BXB	69 Neutral	$31.96B	25.70	26.45%	2.59%	3.86%	―
Sector *	65 Neutral	$26.88B	15.06	-4.01%	3.23%	1.02%	2.11%
MTS	64 Neutral	$4.30B	15.13	18.20%	4.28%	4.04%	-14.50%
WOW	63 Neutral	$37.88B	23.34	32.27%	2.50%	5.26%	―

Metcash Limited Corporate Events

Metcash Limited Announces 2025 AGM Date

Metcash Limited has announced that its Annual General Meeting (AGM) for 2025 will be held on September 10, 2025. The company has set July 9, 2025, as the deadline for receiving nominations for director candidates not recommended by the Board. This meeting is a significant event for stakeholders as it will outline the company’s strategic direction and governance for the coming year.

The most recent analyst rating on (AU:MTS) stock is a Hold with a A$3.40 price target. To see the full list of analyst forecasts on Metcash Limited stock, see the AU:MTS Stock Forecast page.

Metcash Appoints New Company Secretary to Strengthen Governance

Metcash Limited has appointed Johanna O’Shea as the new Company Secretary, effective 28 July 2025. This strategic move is expected to enhance the company’s governance and compliance functions, with Johanna bringing over 20 years of experience in similar roles at major financial institutions. Julie Hutton, the current Chief Legal, Risk and Compliance Officer, will step down as Company Secretary but will maintain her oversight of the company secretariat function. This transition aims to strengthen Metcash’s operational efficiency and ensure robust communication with the ASX, potentially benefiting stakeholders through improved corporate governance.

The most recent analyst rating on (AU:MTS) stock is a Hold with a A$3.40 price target. To see the full list of analyst forecasts on Metcash Limited stock, see the AU:MTS Stock Forecast page.

Metcash Limited Announces Cessation of Performance Rights

Metcash Limited announced the cessation of 26,128 performance rights due to unmet conditions, effective April 30, 2025. This development may impact the company’s capital structure and reflects the challenges in meeting performance criteria, potentially affecting stakeholder confidence and market perception.

Metcash Limited Announces Change in Substantial Holder Interests

Metcash Limited has announced a change in the interests of a substantial holder, Ubiqu© Asset Management Pty Ltd. The substantial holder’s voting power has increased from 6.28% to 5.18% due to on-market purchases totaling $37,917,942, affecting 12,092,561 votes. This change signifies a strategic move by Ubiqu© Asset Management Pty Ltd, potentially impacting Metcash Limited’s shareholder dynamics and market positioning.

Metcash Limited Announces Cessation of Securities

Metcash Limited announced the cessation of 72,500 performance rights due to unmet conditions as of February 28, 2025. This development may impact the company’s capital structure and could have implications for stakeholders, reflecting on the company’s operational adjustments in response to performance metrics.

Metcash Limited Announces Director’s Interest Change

Metcash Limited has announced a change in the director’s interest notice, specifically involving Douglas Jones. The change involves an off-market transfer of 223,701 ordinary shares from the director to Kamasco Pty Ltd ATF The Kamasco Family Trust and Kamasco Pty Ltd ATF the D and R Jones Super Fund, both of which the director is a beneficiary. This transaction does not alter the total number of shares held by the director but changes the nature of the holding from direct to indirect, potentially impacting the company’s internal governance and stakeholder perceptions.

Metcash Limited Adopts New Equity Incentive Plan Rules

Metcash Limited has announced the adoption of new Equity Incentive Plan Rules by its board of directors, effective from November 28, 2024. This move is aimed at structuring the company’s employee incentive scheme, potentially impacting its operational dynamics and aligning employee performance with shareholder interests.