TOL - 4th Aug, 2026
52 company reviews, yet only 7 Buys: What the June-quarter updates have said about value
After reviewing 52 ASX updates over the past fortnight, our verdict is unchanged: genuine opportunities remain limited to a small handful.
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Over the past fortnight, Alpha Insights had reviewed over 50 companies, through a raft of June-quarter production updates, trading updates, including several preliminary FY26 updates.
Three in four of these companies had their fair values adjusted higher, indicative of improving fundamentals across companies. However, also nearly 80% of these companies continue to show negative implied returns (i.e. current prices trading above our intrinsic valuations).
In many of these cases, results have broadly met or beat our model assumptions; though, prices continue to trade ahead of even the revised fair valuations for these companies.
Is quality expensive today?
One striking observation or theme was the continuation of overvaluation in "Quality" ASX names. For instance, from the cohort that updated the market over the past fortnight:
- HUB24 is executing at or above our model, and we raised no major concerns about the business in our note; the stock simply sits roughly 94% above fair value.
- Macquarie's 1Q27 operating momentum was modestly positive, but over-capitalisation is worsening and the stock trades 67% above our estimated fair value.
- For Sandfire, the assumption we cannot underwrite is $13,000/t copper as a permanent price, and at mid-cycle price assumptions (for copper), the stock trades at roughly 2.8x to fair value.
- Evolution's quarter confirmed an exceptional operator at roughly 3x fair value - the 18% decline since May is directionally consistent with our cyclical gold thesis.
- James Hardie's execution validates the franchise while the price extrapolates one quarter into perpetuity; at A$36.99 the stock is a leveraged bet on perfection with no margin of safety.
- Fletcher Building's recovery is confirming, but it is more than fully priced: the stock trades 37% above our indicative fair value at A$3.14.
The ratings breakdown
From the 52 reviews, 21 were Sells (40%), 24 Holds (46%) and 7 Buys (13%). For the Holds, most of them are great businesses; albeit at prices that already reflect the improvement on our estimates.
Moreover, we read the current skew toward Sells and Holds as a function of market sentiment/overpaying, rather than a reflection of negative/deteriorating business performance.
As usual, any interest in what's a sell, will often be superseded by interest in what's currently a buy. And given its minority representation in the mix, why not.
So, here are the 7 buy ratings from the 52 reviews that we have completed over the past fortnight, accompanied with some light commentary.
The seven Buys
Lynas Rare Earths (LYC): The stock at A$15.19 trades below our revised bear case, against a fair value lifted to A$25.92. The JARE floor and the 10-year Malaysia operating licence have fundamentally compressed the downside despite the NdPr price weakness. The asymmetry favours accumulation.
Deep Yellow (DYL): Three binding valuation constraints de-risked simultaneously: long-term uranium contracting broke through US$95.50, FID was pulled forward 12 months, and engineering is 79% complete. At A$1.35, or roughly US$3.1/lb of resource, DYL screens as the cheapest uranium developer in the peer set, at the point where observable contracting behaviour is confirming the structural thesis.
EDU Holdings (EDU): The trimester result validates the enrolled-base thesis: revenue came in 24-31% above our model with margins expanding, and we assess the agent-ban risk as manageable. Measured against the prior authoritative fair value of A$1.55, the implied return from A$1.00 is approximately +54%. The upside to the revised indicative estimate of A$2.15 is larger, at 114%; we quote the more conservative figure because the revised estimate awaits a full model rebuild.
Plenti Group (PLT): A thesis-confirming quarter at a widening discount. Operating momentum is intact, credit is stable, and the catalyst remains on track. The distinguishing feature is that our bear case now equals the market price at A$0.78, which makes the risk-reward asymmetry compelling for patient capital.
Dexus (DXS): APAC de-risking and a validated NTA, set against a 7% price decline, create the entry for a rate-cycle reversion thesis. We upgraded to Buy at A$5.73 and would add below A$5.50.
Spark New Zealand (SPK): A defensive income stock with a visible near-term catalyst; the price decline created the margin of safety. We would accumulate below A$1.70 against a fair value of A$1.88.
St Barbara (SBM): The conditional member of the seven. JV completion and capex 67% below our model inverted the risk-reward, and the rating moved to Buy. But the note's own laddering places full Buy conviction below A$0.35; at A$0.425 the position is closer to a hold pending the full model re-run. We include it as marginal rather than core.
For four of the seven - DXS, SPK, PLT and LYC - the price moved toward the thesis rather than the reverse; for the other three - DYL, EDU and SBM - the thesis itself improved materially, with fair values raised by roughly 31-39%.
Conclusion
With the August reporting season now on the doorstep, we look forward to refreshing our assessments across our broad coverage of stocks. Though, we maintain a cautious approach to the exercise, with a tempered inclination toward optimism.
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Alpha Insights is an AI-powered Research & Market Intelligence platform that centres on a proprietary analytical process, capable of in-depth equity research analysis on companies, and enables an extensive coverage of the entire ASX200 plus more.
After a front-row experience with cancer in 2023, I made a lifelong commitment to support childhood cancer initiatives. Alpha Insights is a product of that commitment, which encapsulates everything I have gained over the years of my investment experience; be it from a professional, academical, or personal capacity. My ambition for Alpha Insights is for it to become a vehicle that can sustainably support childhood cancer initiatives.
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The information provided is general in nature and does not constitute financial advice. It does not take into account your personal objectives, financial situation, or needs. You should consider whether the information is appropriate for you and seek independent professional advice before making any investment decisions.
Any forward-looking statements, projections, or scenario analyses represent the output of quantitative/AI models, and should not be interpreted as recommendations or predictions of future performance.
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Alpha Insights is an AI-powered Research & Market Intelligence platform that centres on a proprietary analytical process, capable of in-depth equity research analysis on companies, and enables an extensive coverage of the entire ASX200 plus more. ...
Expertise
Alpha Insights is an AI-powered Research & Market Intelligence platform that centres on a proprietary analytical process, capable of in-depth equity research analysis on companies, and enables an extensive coverage of the entire ASX200 plus more. ...
Expertise
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