SRG Global Ltd (ASX: SRG) shares have been among the best performers on the ASX 200 index over the past 12 months.
During this time, the diversified infrastructure services company's shares have risen approximately 150%.
Does this mean it is too late to buy this ASX 200 share? Bell Potter doesn't think so.
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What is the broker saying about this ASX 200 share?
Bell Potter was pleased to see the company upgrade its guidance this week after announcing a series of major contract wins. It said:
Contract update: SRG announced a significant contract update, with total award value of $1.85b, up from $0.65b in the last update in November 2025. Contracts were awarded by blue-chip clients across the Water, Defence, Energy, Industrial, Resources, Marine and Data Centre sectors. See pages 2-3 for more details on the individual contract awards.
FY26 guidance upgrade: SRG upgraded FY26 EBITDA to the top-end the $164- 168m guidance (BPe old $166m). At the top-end of the range, FY26 EBITDA growth is forecast to be 32%. Implied growth for the base business (ex-TAMS; assuming prorated $35m EBITDA business case performance) is 14%.
Another positive is that management has initiated guidance for FY 2027 which was ahead of consensus estimates. It adds:
FY27 guidance initiated: SRG estimates FY27 EBITDA to be within the range of $190-200m (BPe old $188m; VA $185m), representing 16% YoY growth at the midpoint of the FY27 guidance range (vs the top-end of the FY26 EBITDA guidance range).
In light of this, Bell Potter has upgraded its earnings estimates and valuation accordingly.
Buy rating reaffirmed
According to the note, the broker has retained its buy rating on the ASX 200 share with an improved price target of $4.25 (from $3.15).
Based on its current share price of $3.75, this implies potential upside of 13.3% for investors over the next 12 months.
In addition, Bell Potter expects a 1.7% fully franked dividend yield, lifting the total potential return to 15%.
The broker concludes:
We have upgraded our Target Price to $4.25/sh (up from $3.15/sh), reflecting more optimistic medium and long-term earnings growth expectations, a lower WACC (now 8.0% previously 8.6%) and a higher TGR (now 4.0%; previously 3.5%). SRG's 27% valuation premium to the Industrial Services peer group (FY27 PE(A)) is justified. Management have a demonstrated a strong track-record of operational execution, delivered accretive acquisitions (Diona and TAMS in recent years) and guidance outperformance.
We see upside to consensus earnings forecasts from forthcoming guidance upgrades and accretive acquisitions. With FCF expanding over FY26-28, we anticipate SRG will be well capitalised to self-fund acquisitions.
