February 2025 Business Turnover Data Bode Well for Industrial and Technology Stocks

Company Overview: Macquarie Technology Group Limited (ASX: MAQ) is an Australian data centre, cloud, cyber security, and telecom service provider. The ASX-listed company caters to mid-to-large business and government customers. NRW Holdings Limited (ASX: NWH) provides diversified contract services to the resources and infrastructure sectors in Australia. The company operates through three segments: Civil, Mining, and Minerals, Energy & Technologies. Kalkine’s Market Event Report covers the Investment Summary, Event Summary, Data Insights & Analysis, Key Financial Metrics, Risks, Outlook, Technical Analysis along with the Valuation, Target Price, and Recommendation on the stock.

Investment Summary

Event Highlights

Data Insights and Analysis

Key Drivers versus Key Challenges

Based on the above data, two ASX stocks have been identified to showcase the momentum.

1) Macquarie Technology Group Limited (ASX: MAQ) (Recommendation: ‘Speculative Buy’ at AUD 59.830, Potential Upside: Low Double-Digit) (M-cap: AUD 1.49bn)

Company Overview: MAQ is an Australian data centre, cloud, cyber security, and telecom service provider. The ASX-listed company caters to mid-to-large business and government customers.

6-month ended 31 December 2024 Financial Year (1HFY25) Financial Performance: MAQ's 1HFY25 financial performance showed positive momentum. Revenue and other income grew by 1% YoY to AUD 183.62mn vs AUD 181.34mn in 1HFY24. This growth was supported by increased revenue from customer contracts and other income. Notably, operating income surged by 21.18% YoY to AUD 28.66mn vs AUD 23.65mn in 1HFY24. Profit after tax attributable to members increased by 21% YoY to AUD 17.93mn (1HFY24: AUD 14.83mn).

Recent Update:  MAQ has announced that Regal Funds Management Pty Limited and its associates have increased their stake in the company to 6.60%, up from 5.17%, as of 7 April 2025.

Outlook: MAQ anticipates its total capital expenditure (capex) for FY25 to be between AUD 162mn and AUD 181mn. The company also projects its FY25 EBITDA to be in the range of AUD 112mn to AUD 115mn, which includes an estimated contribution of AUD 36mn to AUD 37mn from Macquarie Data Centres.

The stock has witnessed a correction of ~37.14% in last nine months, and over the past one year, it decreased by ~23.25%. The stock has a 52-week low and 52-week high of AUD 52.660 and AUD 98.350, respectively, and is currently trading below the 52-week high-low average. MAQ was last covered in a report dated ‘03 March 2025’.

2) NRW Holdings Limited (ASX: NWH) (Recommendation: ‘Speculative Buy’ at AUD 2.390, Potential Upside: Low Double-Digit) (M-cap: AUD 1.09bn)

Company Overview: NWH provides diversified contract services to the resources and infrastructure sectors in Australia. The company operates through three segments: Civil, Mining, and Minerals, Energy & Technologies.

6-month ended 31 December 2024 Financial Year (1HFY25) Financial Performance: In 1HFY25, NWH's revenue grew by 15.8% YoY to AUD 1,651.78mn compared to AUD 1,426.59mn in 1HFY24, driven by increased activity in all operational segments. This revenue growth led to a 20.1% YoY increase in EBITDA to AUD 188.84mn from AUD 157.22 in 1HFY24. The company reported a 24.1% YoY rise in profit from ordinary activities after tax attributable to members, reaching AUD 51.69mn up from AUD 41.65 in 1HFY24.

Recent Update:  NWH has appointed Peter Bryant as the Chief Financial Officer of the company. He will join the company on 5 May 2025.

Outlook: NWH expects its revenue to reach somewhere between AUD 3.2bn and AUD 3.3bn in FY25. Furthermore, the projected EBITA for FY25 is between AUD 205mn and AUD 215mn.

The stock has witnessed a correction of ~30.72% in last three months, and over the past one year, it decreased by ~15.85%. The stock has a 52-week low and 52-week high of AUD 2.290 and AUD 4.025, respectively, and is currently trading below the 52-week high-low average. NWH was last covered in a report dated ‘10 March 2025’.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance. 

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 14 April 2025. The reference data in this report has been partly sourced from REFINITIV. 

Note 3: Investment decisions should be made depending on an individual’s appetite for upside potential, risks, holding duration, and any previous holdings. An ‘Exit’ from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice. 

Technical Indicators Defined: - 

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.