ASX industrials stock McMillan Shakespeare Ltd (ASX: MMS) shot higher yesterday, rising more than 6% during Wednesday's trading session.
This was despite no price-sensitive news out of the company.
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Company overview
McMillan Shakespeare is a leading provider of employee benefits, end-to-end fleet management, and disability support services with under 400,000 salary packages and 80,000 novated leases under management.
The company operates a vertically integrated model by offering standalone and complementary products for administration, vehicle sourcing and life-cycle management, finance procurement, and the sale of secondary consumables.
The employer customer base sees healthcare, government, education, not-for-profit, and corporate sector clients.
This ASX industrials stock has experienced some volatility in 2026, and is ultimately up just over 2% in that span.
For comparison, the S&P/ASX 200 Industrials Index (ASX: XNJ) is down over 2% in that same period.
A new report from Bell Potter suggests that yesterday's spike could be a sign of what's to come for this ASX industrials stock.
Here's what the broker had to say.
Solid growth
In a recent report, Bell Potter noted that the ASX industrials company has reported stronger-than-expected momentum in novated leasing, with new vehicle lease growth rising 7% in 3Q26 despite difficult prior-year comparisons.
Bell Potter noted improving sales momentum, continued customer wins, and increasing adoption of electric vehicles (EVs), with trading conditions expected to strengthen further as government policy uncertainty eases.
The broker believes earnings growth guidance is now lower risk, supported by customer growth and operational efficiencies. The continuation of favourable Fringe Benefits Tax (FBT) exemption settings for EVs is also expected to support demand.
Non-electric vehicle volumes performed better in relative terms, while electric vehicle volumes correlated with data. Given the mix shift, initial revised policy targets should support ongoing demand.
Based on this guidance, earnings per share (EPS) has been increased +0%/+2%/+3% over the next 3 years, reflecting higher novated volumes.
Buy recommendation unchanged
Based on this guidance, the team at Bell Potter has retained their buy recommendation on this ASX industrial stock.
It also increased its price target to $19.90 (previously $18.50).
From yesterday's closing price of $17.65, this indicates an upside potential of approximately 13% for this ASX industrials stock.
The earnings multiple remains undemanding, with positive developments now in place and key uncertainties resolved. No colour on Oly was offered. However, the addressable customer base continues to grow. Further details on broadening demand, and increasing automation, would be another catalyst for the share price.
