Monadelphous Group Ltd (ASX: MND) has had so much good news this week that it had to issue two separate press releases, sending its shares to fresh 12-month highs.
Shares in the engineering firm have more than doubled over the past 12 months, from a low of $12.26 around this time last year to a record high of $25.08 on Monday, following the company's market announcements.
So what exactly did the company announce this week? On the contract front, Monadelphous said it had secured several new contracts in the resources sector, worth a combined $140 million.
These included a three-year extension to a master services agreement with BHP across its iron ore operations in the Pilbara region of Western Australia, work at BHP's Olympic Dam mine in South Australia, and various works with Rio Tinto.
Image source: Getty Images
Strong operating performance
In its separate trading update, the company said things were going well in general, and it had "experienced strong operating conditions throughout the first four months of the 2026 financial year, with activity levels elevated across the business".
Monadelphous said it was currently forecasting revenue for the first half of the year to come in at about $1.5 billion, and while operating activity was expected to moderate in the second half of FY26, "full year revenue (is) currently forecast to be around 20 to 25 per cent higher than the previous year".
Shares still have upside
RBC Capital Markets analysts had a look at Monday's announcements and have issued a new research note on Monadelphous, and it's fair to say they like what they see.
They also believe there could be even more upside for the company, as they said:
We believe the guidance is conservative given it implies that second half FY26 underlying revenue will grow at just 0.7% year on year noting that first half FY26 revenue guidance is for 43% growth. Monadelphous' price to earnings trading multiple is 23.3 times once our earnings changes have been incorporated which is not excessive in our view, or by historic standards.
The RBC analysts said an important takeaway from the Monadelphous trading update was that it demonstrated the strength of the company's diversified product offering, with the company exposed to resources but also newer, expanding sectors such as renewables.
They went on to say:
We believe this will drive resilience in earnings as Monadelphous diversifies alongside higher group margins given the construction opportunities in brownfield projects (as compared to maintenance opportunities).
RBC has sharply upgraded its price target on Monadelphous shares from $20.75 to $26.75 and has also upgraded its rating on the shares to outperform.
This compares with the closing price of Monadelphous shares of $25 on Monday, valuing the company at $2.5 billion.
Monadelphous will hold its annual general meeting on 25 November.
