Looking for an undervalued ASX All Ords share with some serious growth potential?
Then you may want to check out All Ordinaries Index (ASX: XAO) listed Austin Engineering Ltd (ASX: ANG).
That's according to the latest research report from Argonaut analyst Jon Scholtz, who foresees some outsized growth ahead for the global, mining-focused engineering company.
What's been happening with Austin Engineering shares?
In afternoon trade today, Austin Engineering shares are down 0.8%, changing hands for 38 cents apiece.
That sees the ASX All Ords share down 29% in 2025, despite the 7% gains posted since last Thursday's close. The stock also trades on a fully franked trailing dividend yield of 3.7%.
Looking ahead, however, Argonaut forecasts a much stronger 12-month run.
Why this ASX All Ords share is a buy
Argonaut has a buy recommendation on Austin Engineering, with a price target of 68 cents a share. That represents a potential upside of 80.0% from current levels.
Commenting on the bullish outlook for the ASX All Ords share, Scholtz said:
The growing orderbook and global presence drives revenue and earnings growth. Our forecasts remain in line with guidance, which highlight 12% revenue growth YoY and 30% Ebit(a) growth YoY.
Working capital unwind in 2HFY25 should also be a positive for cash flow. We believe ANG is trading at compelling multiples, well below historical averages.
Austin Engineering's revenue guidance for FY 2025 is $350 million. Argonaut tips the company will beat that target by delivering $352 million in full-year revenue, representing 12.4% year-on-year growth.
For the first half of the financial year, the ASX All Ords share reported revenue of $170.2 million, up 18.5% year on year.
The engineering company also expects to achieve FY 2025 earnings before interest and tax (EBIT) of $50 million. Argonaut expects earnings growth to be slightly lower, forecasting full-year EBIT of $46.1 million.
What about the pending leadership change?
Management transitions can sometimes prove problematic for ASX companies. But Argonaut doesn't believe Austin Engineering's pending CEO changeover will negatively impact the ASX All Ords share.
"The CEO and management transition period has commenced, with the hand over to Sy Van Dyk ongoing," Scholtz said. "Sy will officially commence as CEO and MD from 1 July 2025."
Scholtz added:
David Singleton was the key architect of the Austin 2.0 strategy, and we continue to expect growth under Sy. We see his appointment as logical and do not anticipate any major shifts in strategy under his leadership as he would have been actively involved at board level in its establishment.
