This report is an updated version of the report published on 22 September 2025 at 3:55 PM AEST.

Australian Agricultural Company Limited (ASX: AAC)

Australian Agricultural Company Limited is an Australia-based beef and integrated cattle producer. The company is engaged in selling and marketing branded beef globally, along with developing coastal properties, breeding backgrounding, and feed lotting across Australia.

Recommendation Rationale – SELL at AUD 1.55

• Trading Around Resistance: The stock has crossed its first resistance (R1) of AUD 1.511. However, its 14-day RSI is showing a reading of ~66.41 (approaching overbought zone); hence, the stock may face some consolidation before scaling further upside.
• Overvalued Multiples: On a forward 12-month basis - key valuation multiples (EV/Sales, EV/EBITDA, P/E and Price/Cash Flow) are higher than the median of Food & Tobacco industry.
• Negative Bottomline: In FY25, AAC’s revenue rose 15% to AUD 387.9 million, compared with AUD 336.1 million in FY24. It recorded a statutory EBITDA of AUD 56.3 million, reversing the AUD 87.9 million loss of the previous year. Its bottom-line, although improved significantly YoY in FY25, it still remains negative at AUD 1.05 million, compared to a net loss of AUD 94.6mn reported in FY24.
• Volatility in Input and Commodity Prices: Costs of key inputs such as feed, fuel, fertilizers, and labor can fluctuate with global commodity markets, transportation costs, or geopolitical events. Conversely, beef/cattle market prices are subject to demand, competition, and trade policy. Margin pressure arises if input costs increase faster than revenue.

ACC Daily Chart

Valuation Methodology: Price/Cash Flow Approach (FY March'26E) (Illustrative)

The stock might trade at a slight premium to its peers, considering improved demand in key markets, FY26 outlook, Revenue and EBITDA growth in FY25. For conducting valuation, the following peers have been considered: Cobram Estate Olives Ltd (ASX: CBO), Farm Pride Foods Ltd (ASX: FRM), Bubs Australia Ltd (ASX: BUB) and others.

Considering the rally in share price movement, current trading level, and risks associated, the share price can witness consolidation at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current market price of AUD 1.55, as of 22 September 2025 at 3:53 PM AEST.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. 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 22 September 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.