Reece Limited (AU:REH)
ASX:REH
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Reece Limited
(Sydney:REH)
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Rating:69Neutral
Price Target:
AU$15.00
▲(18.02% Upside)
Action:Reiterated
Date: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
Branch-based distribution network
A dense branch network servicing professional trades and projects creates high-frequency, repeat purchasing and strong customer stickiness. Physical presence plus digital channels supports share-of-wallet, reliable revenue streams and durability across regions and project cycles for months ahead.
Negative Factors
Declining net profit margin
A falling net margin signals pressure on profitability from cost inflation, pricing or mix shifts. If persistent, margin erosion can limit internal funding for growth initiatives, reduce return on invested capital and weaken the business’s ability to convert revenue into durable earnings.
Read all positive and negative factors
Positive Factors
Negative Factors
Branch-based distribution network
A dense branch network servicing professional trades and projects creates high-frequency, repeat purchasing and strong customer stickiness. Physical presence plus digital channels supports share-of-wallet, reliable revenue streams and durability across regions and project cycles for months ahead.
Read all positive factors
Reece Limited (REH) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$8.40B
Dividend Yield1.4%
Average Volume (3M)959.93K
Price to Earnings (P/E)14.6
Beta (1Y)1.64
Revenue Growth2.83%
EPS Growth-24.39%
CountryAU
Employees18,000
SectorIndustrials
Sector Strength72
IndustryIndustrial - Distribution
Share Statistics
EPS (TTM)0.44
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$14.98Price Target Upside17.89% Upside
Rating ConsensusHold
Number of Analyst Covering6
EPS Forecast (FY)0.46
Revenue Forecast (FY)AU$9.28B
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 purchasing plumbing, waterworks and HVAC-R products from manufacturers and suppliers and reselling them to customers at a margin through its branch network and online ordering/delivery capabilities. Key revenue strea...
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
Positive
12.71
Price Trends
13.68
Negative
14.07
Negative
12.93
Positive
Market Momentum
-0.06
Negative
52.14
Neutral
71.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:REH, the sentiment is Positive. The current price of 12.71 is below the 20-day moving average (MA) of 13.47, below the 50-day MA of 13.68, and below the 200-day MA of 12.93, indicating a neutral trend. The MACD of -0.06 indicates Negative momentum. The RSI at 52.14 is Neutral, neither overbought nor oversold. The STOCH value of 71.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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$551.63M | 6.81 | 15.52% | 6.20% | 1.27% | 26.06% | |
69 Neutral | AU$8.40B | 14.57 | 7.27% | 1.40% | 2.83% | -24.39% | |
69 Neutral | AU$249.25M | 12.10 | 9.11% | 5.71% | 25.68% | -11.47% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
60 Neutral | AU$2.32B | 11.09 | 7.43% | 2.00% | -1.47% | -16.42% | |
58 Neutral | AU$190.99M | 6.61 | 5.98% | 2.95% | -2.87% | -18.36% | |
46 Neutral | AU$47.98M | -1.95 | -23.25% | ― | -0.67% | -6354.00% |
* Industrials Sector Average
AU:REH
Reece Limited
13.65
-1.48
-9.76%
AU:CYG
Coventry Group Limited
0.35
-0.48
-57.93%
AU:RWC
Reliance Worldwide Corp.
3.15
-1.15
-26.76%
AU:WAT
Waterco Limited
5.45
-1.36
-19.95%
AU:ACF
Acrow Formwork and Construction Services Limited
0.80
-0.17
-17.70%
AU:GWA
GWA Group Limited
2.08
-0.16
-7.06%
Reece Limited Corporate Events
Reece Issues New Unquoted Equity Rights Under Employee Incentive Schemes
Apr 16, 2026
Reece Limited has notified the market of the issue of new unquoted equity securities under its employee incentive schemes, comprising retention rights, performance rights, and a new class of service rights. The securities, which are subject to tra...
Reece Limited announces lapse of retention rights under incentive plan
Apr 16, 2026
Reece Limited has notified the market that 21,749 retention rights, classified as REHAA securities, have lapsed after the conditions attached to these rights were not met or became impossible to satisfy as of 31 March 2026. The lapse of these cond...
Reece appoints Timothy Ford to board with small indirect shareholding
Apr 7, 2026
Reece Limited has appointed Timothy Ford as a director effective 8 April 2026, marking a change in the composition of its board and signalling a continued focus on strengthening governance and leadership. Ford does not directly hold any Reece secu...
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...
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.