Rudi’s View: August Results; Standouts, Turnarounds, Failures & Misfits

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Making sense out of August performances by corporate Australia through a broader, macro lens.

By Rudi Filapek-Vandyck, Editor

While mulling over earnings reports and their potential ramifications for the year(s) ahead, I reminded myself of that old verse of wisdom regarding friends and acquaintances we all meet in life:

Some are there for a reason, others for the season, and only a few are here for life.

I am by no means suggesting one should treat listed equities as a personal “friend”, but the underlying principle can certainly be applied more broadly.

Some companies are worth holding on to, sometimes for years and years on end. Others are best treated as a short-term experience. Usain Bolt might have been the world’s fastest runner in his heydays, he simply wasn’t suited for a long-distance contest.

The quicker we, as investors, understand this, the better our strategy, execution and investment return.

Note: there’s no such thing as perfect execution, and luck always plays its part, but we can but do our best to read the signals and interpret them in the best ways possible.

And yet, a lot comes down to what kind of investor we are, and what our specific strategy and investment horizon is.

Below are some of the trends and characteristics identified from the recent August results season.

To be read and interpreted in line with our own risk appetite and personal investment approach.

Category #1 – Hercules & Friends

There’s a group of ASX-listed companies that is operating from a purple patch. Everything works out fine. The occasional cloud in the sky is nothing but a short-term distraction. Shareholders are smiling all the way to the bank (proverbially).

Some of these companies have been on a strong winning streak for many years, and there doesn’t appear a pothole or bend in the road. Alas, for those investors not yet on board, share price valuations tend to reflect the wonderfully, strong and healthy conditions.

My personal view is every portfolio should have at least some exposure to some of these Corporate Champions, but when is the right time to jump on board?

Investors are noticeably more nervous about equities suffering a “correction” or “pullback” in the weeks or months ahead.

Observe, for example, the views expressed by market strategists at Bell Potter on Monday morning:

“We are tactically cautious US equities over the next 3-4 months due to the elevated risk of a market correction in the near term.

“Elevated valuations leave little margin for error, making the market highly sensitive to negative catalysts and vulnerable to a correction.”

And:

“The ASX200 has continued to rally despite an ongoing earnings downgrade cycle, taking its lead from global markets in a move we believe is unjustified given Australia’s weaker growth outlook.”

Many of these share prices got wallopped back in April, only to sprint back to fresh all-time record highs once the tariffs tension subsided.

Maybe such a downward move in markets will offer another opportunity to revisit the Strong and the Mighty at lower, more comfortable price levels?

Pick your pick from the following list:

-Aussie Broadband ((ABB))
-Breville Group ((BRG))
-Car Group ((CAR))
-Codan ((CDA))
-Coles Group ((COL))
-Generation Development ((GDG))
-Goodman Group ((GMG))
-Hub24 ((HUB))
-JB Hi-Fi ((JBH))
-Life360 ((360))
-Netwealth Group ((NWL))
-Pinnacle Investment Management ((PNI))
-Pro Medicus ((PME))
-Qualitas ((QAL))
-REA Group ((REA))
-Regal Partners ((RPL))
-ResMed ((RMD))
-Sigma Healthcare ((SIG))
-Superloop ((SLC))
-Temple & Webster ((TPW))
-Wesfarmers ((WES))

Category #2 – Houston, we have a problem

Sometimes a business hits a barrier, a nasty bend in the road, or it gets struck by lightning.

It’s evidence we all are but mortal and vulnerable and Dame Fortuna sometimes mis-times her absence when we need her to intervene.

In many cases, the punishment that follows through a weaker share price is but a gift for those who can see through the fog and focus on the unique circumstances and events, with an eye on the longer-term horizon.

At times, however, the waited-for rebound turns into the brainchild of Samuel Beckett (Waiting for Godot) and as time passes by, it dawns upon investors there’s more trouble brewing than what was understood and assumed.

By now, we’re looking over our shoulder to a share price that has only weakened further and deeper, with August yet another season that did not live up to expectations.

Time to finally flick the disappointment, or do we remain stoic in our belief and conviction? Do we up the ante and buy more shares?

CSL‘s ((CSL)) disappointment last month was larger and more impactful than anything witnessed from this company in a very long time. Unsurprisingly, a number of strategists and analysts have expressed significant loss of confidence in the aftermath.

As reported last week, Wilsons’ Focus Portfolio reduced its exposure by half; to 4% from 8%. Portfolio strategists at Bell Potter sold out completely.

While the stock is still held in the FNArena/Vested Equities All-Weather Model Portfolio (we had reduced exposure earlier) we can but sympathise with general sentiment; the August market update was a painful pill to swallow, signalling all’s not well inside the ranks of Australia’s major (and most successful) biotech.

The decision to spin off Seqirus almost feels like policy on the run and certainly fails in the general communication supporting the move. Are the shares cheaply valued? They most certainly are, but unless the market sees a better operational trajectory ahead, it’s difficult to see the CSL share price knocking it out of the park.

Not making it any easier for current management to turn this ship around: the current US administration still has another 3.5 years in it.

The uncertainty (and disappointment) from supermarket operator Woolworths Group ((WOW)) is not dissimilar. FNArena published an excellent and insightful dissertation about the Coles Group ((COL)) versus Woolworths gap in relative performances on Monday:

https://fnarena.com/index.php/2025/09/08/coles-does-it-better-woolworths-de-rated/

In both cases, my suspicion is investors might have to be a lot more patient, and maybe for longer than they might be thinking of, post August disappointments.

Cheaply priced share prices tells us nothing about the timing of the recovery and neither does it imply there cannot be more disappointment on the menu first.

The challenge for CSL and Woolworths will be to avoid the scenarios that have unfolded for the likes of Domino’s Pizza ((DMP)) and Ramsay Health Care ((RHC)).

Not quite as severe, but on a streak of continuous disappointment nevertheless, are the likes of AGL Energy ((AGL)), Amcor ((AMC)), ASX Ltd ((ASX)), Cochlear ((COH)), Ebos Group ((EBO)), Monash IVF ((MVF)), Pexa Group ((PXA)), Sonic Healthcare ((SHL)), and WiseTech Global ((WTC)).

This basket of stocks also includes a variety of lesser quality companies that mostly disappointed over an elongated period of time.

Cheaply-priced corporates that in many cases have galvanised the statement: cheap for good reason.

Disappointed yet again in August:

-ARN Media ((A1N)),
-Audinate Group ((AD8))
-Aurizon Holdings ((AZJ))
-Bapcor ((BAP))
-Beach Energy ((BPT))
-Centuria Office REIT ((COF))
-Endeavour Group ((EDV))
-Fletcher Building ((FBU))
-GWA Group ((GWA))
-Healius ((HLS))
-HealthCo Healthcare & Welnness REIT ((HCW))
-Inghams Group ((ING))
-Integrated Research ((IRI))
-IPH Ltd ((IPH))
-Matrix Composites & Engineering ((MCE))
-Nuix ((NXL))
-ReadyTech Holdings ((RDY))
-Seven West Media ((SWM))
-Treasury Wine Estates ((TWE))

Bank of Queensland ((BOQ)) and Nufarm ((NUF)) only released a trading and strategy update, but that didn’t make the disappointment any less. They might as well join the list.

James Hardie Industries ((JHX)) is operating in its own separate universe these days, without the slightest regards for shareholders and seemingly on a crash-course to annihilate the share price.

Whatever the restrictions are that prevents the ASX from stronger action and/or intervention, this aint right. It’s an embarassment that cannot be highlighted often enough.

Category #3 – Look at me, folks!

Whether they were flying under the radar previously or going through a tough time, maybe new management has settled in, or the industry dynamics are fundamentally changing; every result season unearths strong operational performances from companies not yet well-known or understood.

The past result season has put these companies on the podium and they are asking for investors’ attention.

Could this be the beginning of a multi-year rewarding journey? Or was it simply a lucky strike, soon to fizzle and deflate?

Only time will tell.

New Kids on the Promising Outlook podium include:

-Cuscal ((CCL))
-Electro Optic Systems ((EOS))
-Gemlife Communities ((GLF))
-Judo Capital ((JDO))
-MA Financial ((MAF))
-Praemium ((PPS))
-Qoria ((QOR))
-SiteMinder ((SDR))
-SKS Technologies ((SKS))

Category #4 – It’s the cycle, stupid!

RBA rate cuts and a more stable inflation environment is creating a better environment for consumer spending and construction activity in Australia.

It’s why share prices of retailers rallied strongly in August and why sector analysts covering the likes of GPT Group ((GPT)), Stockland ((SGP)), Wagners Holdings ((WGN)), Big River Industries ((BRI)) and Acrow ((ACF)) are expressing more confidence with their projections.

Among the eye-catching outperformers were automotive-related companies, including Autosports Group ((ASG)), Eagers Automotive ((APE)), and McMillan Shakespeare ((MMS)).

The one potential problem with these scenarios is that everyone all of a sudden seems convinced the RBA will deliver two more rate cuts and stimulate the domestic economy back into acceleration mode, while Michele Bullock & Co might just surprise in negative fashion, yet again.

Also, across the Tasman, the central bank in New Zealand has done a lot more rate cutting and the economy over there still finds it difficult to get any durable traction. Despite August enthusiasm, the positive scenarios put forward are far from a fait accompli (excuse my French).

Also very much catching investors’ attention throughout the season were gold producers and contract services providers, including Duratec ((DUR)), Emeco Holdings ((EHL)), Maas Group ((MGH)), Macmahon Group ((MAH)), Monadelphous ((MND)), NWR Holdings ((NWH)), SRG Global ((SRG)), Worley ((WOR)), and numerous others.

Category #5 – Is that a turnaround?

It was the wise Oracle of Omaha himself who once declared the problem with most turnaround stories is they seldom successfully turn around (or something alike).

But it does happen, at times, that things have gotten so bad, there really is only one way left, and that is upwards.

Companies that –finally– served up some better fortune in August include:

-AMP ((AMP))
-a2 Milk (A2M))
-Challenger ((CGF))
-Integral Diagnostics ((IDX))
-Kelsian Group ((KLS))
-Mineral Resources ((MIN))
-Objective Corp ((OCL))
-Orora ((ORA))
-Pepper Money ((PPM))
-Playside Studios ((PLY))
-Redox ((RDX))
-Seek ((SEK))
-Tabcorp Holdings ((TAH))

Category #6 – I am risky, did you forget?

Not all stocks are equal in their risk profile and while explosive returns certainly can be on offer –just look at 4DMedical ((4DX))– this knife most definitely cuts both ways.

August presented some painful reminders for investors with an above-average penchant for risk taking.

Think Avita Medical ((AVH)), ImExHS ((IME)), Mach7 Technologies ((M7T)), and Telix Pharmaceuticals ((TLX)).

Category #7 – The AI Megatrend is Spreading

Apart from strong performances by Goodman Group and NextDC ((NXT)) –even though the market had higher expectations for Goodman– the August result season also featured regular references to investments in and development of AI applications.

From ALS Ltd ((ALS)) to Nine Entertainment ((NEC)), to Sonic Healthcare and WiseTech Global; AI is increasingly featuring in market updates and future investments.

While the critics are correct; there is to date very little to show for in terms of tangible returns generated, this does not equal waste of money and time (or that we are experiencing the replay of the Nasdaq bubble meltdown of March 2000).

I intend to follow up on this feature separately.

Consider the above incomplete, but I am hoping it will serve as a reference sheet for investors reviewing their portfolio post August.

****

Next Monday I will be presenting in front of members of the Australian Shareholders’ Association (ASA) in Canberra.

Weekly Insights shall resume the following week.

****

FNArena’s Monitor for August results: https://fnarena.com/index.php/reporting_season/

Paying subscribers have 24/7 access to my curated lists for All-Weather Performers and related selections: https://fnarena.com/index.php/analysis-data/all-weather-stocks/

Review All-Weather Model Portfolio

The financial year ending on June 30th 2025 featured the return of Donald Trump in the White House and of extreme market volatility.

The second half of the year also saw doubt creeping into general sentiment towards AI and demand for data centres.

All in all, a gain of 13.85% (pre-fees) for the twelve months is not something to be unhappy about, right?

FY25 review of the All-Weather Model Portfolio: https://www.fnarena.com/index.php/download-article/?n=4B38C0EF-A173-8CE6-736A7AFC7B19FC49

Model Portfolios, Best Buys & Conviction Calls

This section appears from now on every Thursday morning in a separate update on the website. See Rudi’s Views for the archive going back to 2006 (not a typo).

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A subscription to FNArena (6 or 12 months) comes with an archive of Special Reports (21 since 2006); examples below.

(This story was written on Monday, 8th September 2025. It was published on the day in the form of an email to paying subscribers, and again on Wednesday as a story on the website).

(Do note that, in line with all my analyses, appearances and presentations, all of the above names and calculations are provided for educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions. All views are mine and not by association FNArena’s see disclaimer on the website.

In addition, since FNArena runs a Model Portfolio based upon my research on All-Weather Performers it is more than likely that stocks mentioned are included in this Model Portfolio. For all questions about this: contact us via the direct messaging system on the website).

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