Reece Limited (AU:REH)
ASX:REH
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Reece Limited
(Sydney:REH)
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Rating:69Neutral
Price Target:
AU$14.50
▲(5.92% Upside)
Action:ReiteratedDate:02/24/26
The score is driven primarily by solid financial performance (growth and generally stable operating margins), supported by strong technical momentum and an established uptrend. These positives are tempered by a relatively expensive valuation (P/E ~28, low yield) and some emerging financial headwinds from declining net margin and slower free cash flow growth.
Positive Factors
Diversified distribution network
Reece's wide branch footprint across Australia, New Zealand and the US spreads customer access and reduces single-market dependency. This durable distribution scale supports trade relationships, inventory flow, and logistics advantages that sustain market share and resilience over business cycles.
Negative Factors
Declining net margin and weaker free cash flow
A falling net margin and slowing free cash flow growth can erode the firm's ability to self-fund expansion, pay dividends or invest in systems. Over several quarters this can constrain strategic investments and raise questions about earnings quality and sustainable return on capital.
Read all positive and negative factors
Positive Factors
Negative Factors
Diversified distribution network
Reece's wide branch footprint across Australia, New Zealand and the US spreads customer access and reduces single-market dependency. This durable distribution scale supports trade relationships, inventory flow, and logistics advantages that sustain market share and resilience over business cycles.
Read all positive factors
Reece Limited (REH) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$8.42B
Dividend Yield1.4%
Average Volume (3M)959.93K
Price to Earnings (P/E)14.6
Beta (1Y)1.67
Revenue Growth-1.39%
EPS Growth-24.40%
CountryAU
Employees18,000
SectorIndustrials
Sector Strength72
IndustryIndustrial - Distribution
Share Statistics
EPS (TTM)0.23
Shares Outstanding615,092,000
10 Day Avg. Volume1,456,554
30 Day Avg. Volume959,929
Financial Highlights & Ratios
PEG Ratio-1.18
Price to Book (P/B)2.29
Price to Sales (P/S)1.03
P/FCF Ratio27.08
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$16.86Price Target Upside23.12% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)0.47
Revenue Forecast (FY)AU$9.29B
Reece Limited Business Overview & Revenue Model
Company Description
Reece Limited engages in the distribution of plumbing, bathroom, heating, ventilation, air-conditioning, waterworks, and refrigeration products in Australia, the United States, and New Zealand. The company also distributes irrigation and pools, fi...
How the Company Makes Money
Reece primarily makes money by buying products from manufacturers and wholesalers and reselling them at a margin through its branch and distribution network (and supporting digital channels) to plumbers, builders, HVAC-R contractors, and infrastru...
Reece Limited Financial Statement Overview
Summary
Income Statement
75
Positive
Balance Sheet
70
Positive
Cash Flow
65
Positive
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 9.22B | 8.98B | 9.10B | 8.84B | 7.65B | 6.27B |
| Gross Profit | 2.62B | 2.56B | 2.61B | 2.51B | 2.14B | 798.32M |
| EBITDA | 876.67M | 863.32M | 983.92M | 912.41M | 820.78M | 702.99M |
| Net Income | 280.27M | 316.94M | 419.17M | 387.61M | 392.49M | 285.60M |
Balance Sheet | ||||||
| Total Assets | 7.25B | 7.42B | 7.09B | 6.92B | 6.61B | 6.12B |
| Cash, Cash Equivalents and Short-Term Investments | 185.95M | 275.41M | 341.38M | 372.71M | 220.48M | 828.97M |
| Total Debt | 3.35B | 1.97B | 1.83B | 1.96B | 1.90B | 2.01B |
| Total Liabilities | 3.58B | 3.37B | 3.21B | 3.30B | 3.29B | 3.23B |
| Stockholders Equity | 3.66B | 4.05B | 3.88B | 3.63B | 3.32B | 2.89B |
Cash Flow | ||||||
| Free Cash Flow | 346.16M | 341.40M | 492.93M | 588.90M | 21.68M | 299.00M |
| Operating Cash Flow | 542.84M | 599.78M | 750.90M | 766.38M | 221.79M | 371.64M |
| Investing Cash Flow | -278.02M | -342.50M | -243.96M | -309.52M | -280.98M | -67.92M |
| Financing Cash Flow | -344.78M | -323.53M | -538.80M | -307.12M | -574.66M | -462.13M |
Reece Limited Technical Analysis
Negative
13.69
Price Trends
14.52
Negative
13.57
Positive
12.99
Positive
Market Momentum
-0.33
Positive
43.90
Neutral
40.30
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:REH, the sentiment is Negative. The current price of 13.69 is below the 20-day moving average (MA) of 14.10, below the 50-day MA of 14.52, and above the 200-day MA of 12.99, indicating a neutral trend. The MACD of -0.33 indicates Positive momentum. The RSI at 43.90 is Neutral, neither overbought nor oversold. The STOCH value of 40.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:REH.
Reece Limited Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | AU$564.89M | 6.81 | 15.52% | 6.20% | 1.21% | 12.29% | |
69 Neutral | AU$8.42B | 14.57 | 7.27% | 1.40% | -1.39% | -24.40% | |
69 Neutral | AU$277.29M | 12.10 | 9.11% | 5.71% | 25.14% | -14.54% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
60 Neutral | AU$2.23B | 11.09 | 7.43% | 2.00% | 6.78% | 16.25% | |
58 Neutral | AU$200.12M | 6.61 | 5.98% | 2.95% | 4.52% | -31.16% | |
46 Neutral | AU$55.63M | -1.95 | -23.25% | ― | -1.58% | -3756.06% |
* Industrials Sector Average
AU:REH
Reece Limited
13.69
-0.89
-6.13%
AU:CYG
Coventry Group Limited
0.40
-0.52
-56.52%
AU:RWC
Reliance Worldwide Corp.
2.99
-0.68
-18.57%
AU:WAT
Waterco Limited
5.71
-0.39
-6.39%
AU:ACF
Acrow Formwork and Construction Services Limited
0.89
-0.04
-4.61%
AU:GWA
GWA Group Limited
2.13
0.11
5.34%
Reece Limited Corporate Events
Reece bolsters board independence with appointment of Tim Ford as Lead Independent Director
Apr 7, 2026
Reece Limited has appointed former Treasury Wine Estates chief executive Tim Ford as its new Lead Independent Director, effective 8 April 2026, and as a member of both the Audit and Risk Committee and the Remuneration Committee. Ford brings more t...
Reece Director Jacqueline Chow Increases Personal Shareholding
Apr 1, 2026
Reece Limited has disclosed a change in director Jacqueline Chow’s shareholding, with her directly purchasing 3,500 ordinary shares on-market on 31 March 2026. The transaction, valued at $48,300, increases her holding from 2,500 to 6,000 ord...
Reece trims potential share pool as incentive rights lapse
Mar 29, 2026
Reece Limited has reported the lapse of a series of employee equity instruments, including retention rights, options, and performance rights, after the conditions attached to them were not met or became incapable of being satisfied. The cessation ...
Reece Issues Major Tranche of Unquoted Equity for Staff Incentives
Mar 29, 2026
Reece Limited has notified the market of the issue of a substantial tranche of unquoted equity securities under its employee incentive schemes. The company is issuing retention rights, performance rights, and a large new class of options exercisab...
Reece Boosts Director Equity with Major Long-Term Incentive Grant
Mar 29, 2026
Reece Limited has disclosed a significant change in the equity interests of director Sasha Nikolic, who received 1,321,586 performance rights and 3,589,375 options under the company’s Long Term Incentive Plan on 30 March 2026. The issuance, ...
Reece updates market on director Peter Wilson’s expanded deemed holdings
Mar 29, 2026
Reece Limited has disclosed a change in the relevant interests of director Peter Wilson in the company’s securities, as required under ASX listing rules. The notice outlines his direct holdings of shares, options, performance rights, and ret...
Reece Overhauls Executive Pay to Back 2030 Growth Strategy
Mar 29, 2026
Reece Group has finalised a new 2030-focused remuneration framework for its Chair CEO and Group President Managing Director, replacing short-term incentives with a larger, multi-year long-term incentive package. The redesigned structure aims to ...
Reece Director Angela Mentis Increases Indirect Shareholding
Mar 4, 2026
Reece Limited has disclosed a change in director Angela Mentis’s indirect shareholding, reflecting an increase in her personal financial stake in the company. Through the Mentis Superannuation Fund, her holding rose from 7,000 to 12,800 ordi...
Reece sets April payment date for interim dividend
Feb 22, 2026
Reece Limited has declared a semi-annual dividend of AUD 0.0544 per ordinary fully paid share for the period ending 31 December 2025, reinforcing its pattern of regular shareholder distributions. The dividend will trade ex on 17 March 2026, with a...
Reece outlines half‑year FY26 results with caution on forward‑looking and non‑IFRS data
Feb 22, 2026
Reece Limited released its half‑year FY26 results for the six months ended 31 December 2025, outlining its current activities and financial performance in summary form. The company cautioned investors about relying on forward‑looking s...
Reece grows revenue but profits slide as housing slowdown bites
Feb 22, 2026
Reece Limited reported half-year 2026 sales revenue up 6% to $4.65 billion, driven by network expansion, but like-for-like sales were flat as subdued housing markets in ANZ and the U.S. weighed on demand. Profitability weakened, with EBITDA down 6...
Reece revenue climbs on network growth as expansion costs hit profit
Feb 22, 2026
Reece Group reported mixed interim results for the six months to 31 December 2025, as challenging housing market conditions in Australia, New Zealand and the United States weighed on profitability despite higher sales. Group revenue rose 5.6% to $...
Reece to Release HY26 Results and Host Investor Webcast in February
Jan 29, 2026
Reece Limited has announced it will release its HY26 financial results for the six months ended 31 December 2025 on Monday, 23 February 2026, providing investors with an update on the plumbing and HVAC distributor’s trading performance acros...
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.