Treasury Wine Estates Ltd (ASX: TWE) shares are higher on Thursday, giving investors a bit of relief after a rough start to the year.
In afternoon trade, the Treasury Wine share price is up 1.73% to $3.825.
That is a solid bounce from the $3.34 low it hit on 26 March, which was its lowest level in about 10 years. The last time the stock traded around this price was back in April 2014.
Even after today's gain, Treasury Wine shares are still down roughly 27% in 2026, showing just how tough the sell-off has been.
The rebound suggests some investors may be starting to believe the worst could now be priced in.
Image source: Getty Images
Why buyers may be stepping in
One reason buyers appear to be returning is the growing view that Treasury Wine may now be trading below what its assets are worth.
According to The Australian, broker CLSA believes the company's wine brands and inventory could be worth far more than the current share price suggests.
The broker estimated Treasury Wine's net tangible assets were about $3.40 per share at the half-year result and could rise to $3.70 by FY27.
It also suggested an adjusted valuation of $7.10 per share, helped by the value of premium wine stock and major brands like Penfolds.
That big gap between the share price and estimated asset value may be encouraging bargain hunters to buy after the recent fall.
Another positive sign is that French investor Olivier Goudet has reportedly continued buying shares, steadily building his stake in the company.
The sell-off may be slowing
The chart also suggests the heavy selling may be starting to settle down.
The $3.34 level now looks like an important support zone, which simply means buyers have stepped in around that price.
Since then, the shares have bounced back toward $3.80, which is often a sign that sellers are losing control.
If the recovery continues, the next area investors may watch is around $4, followed by the previous trading range near $4.50.
Momentum indicators are also improving.
The relative strength index (RSI), which helps show whether a stock has been sold too heavily, has lifted from oversold levels.
Foolish Takeaway
Treasury Wine still has work to do after its weak half-year result, softer US sales, and concerns about growth in China.
But after falling to decade lows, today's rebound suggests some investors are starting to see value in this ASX 200 blue chip again.
If earnings stabilise and confidence returns, Treasury Wine could become one of the ASX's biggest turnaround stories this year.
