Rudi's View | Feb 18 2026
This story features WISETECH GLOBAL LIMITED, and other companies.
For more info SHARE ANALYSIS: WTC
The company is included in ASX50, ASX100, ASX200, ASX300, ALL-ORDS and ALL-TECH
At times, it's the most difficult question to answer: if it's such a great company, how come its shares keep falling?
By Rudi Filapek-Vandyck, Editor
That question has become even more prevalent as some companies whose share price is under pressure did not disappoint with their market updates. In some cases, their operational numbers proved better-than-expected, including guidance for the year(s) ahead.
The question has been asked multiple times over in the first seven weeks or so of calendar year 2026 as growth and technology stocks are experiencing true bear market conditions.
With technical indicators suggesting heavily oversold conditions for many by last week’s end, share prices are having a better session on Monday. But one swallow most definitely does not a summer make.
Realistically, nobody knows how far this will go or when exactly the selling will stop.
On my observation, the way investors perceive what is going on in today’s share market is almost exclusively linked to where their portfolio’s exposure and thus personal interest are concentrated.
Those who are on board the resurgent commodities trade, see the downfall of AI, technology and growth as simply the natural re-adjustment after years of outperformance and exuberance. Those who witness their portfolio taking a big dive can hardly believe their eyes.
Equally noteworthy: we humans, we live by the narratives of the day and many of today’s narratives suit the underlying trends in share prices.
There are currently so many narratives going around, there’s not even a genuine consensus on why the relentless selling for WiseTech Global ((WTC)), TechnologyOne ((TNE)) and the likes has taken place (they might be conveniently grouped together under the label of ‘future AI threatened’).
One thing is certain: the machines are heavily involved. Continuous AI development, and availability, has made sure everyone with time and determination can now master his/her own automated proprietary trading machine and indications are such algorithmic trading is heavily involved in 2026.
But by no means, don’t look at your neighbour who happens to run a successful trading robot on the side. The world’s big boys are onto this now, and they are as active in Australia as they’ve been in the past.
See also some fresh insights on this matter published by the AFR on Monday, involving Two Sigma and Susquehanna under the title High-frequency hijack makes ASX like a casino.
On Macquarie’s assessment, results releases in the first half of February have triggered on average a share price decline of -22% in case of disappointment.
The share market is seldom kind to companies that fail to meet expectations, but that number is a lot higher than what Australian shareholders and local business leaders had become accustomed to.
And so the trend of higher volatility, in particular to the downside, for ASX-listed companies has simply accelerated onto a higher gear in 2026. I wouldn’t bet this extreme bout of volatility will not continue over the two weeks remaining, when things get genuinely busy.
For good measure: positive momentum is now with commodities, cyclicals and yesteryear’s laggards –the so-called value segment of the market– and thus far financial results are underpinning the market’s newfound heroes.
The first 53 assessments in FNArena’s Corporate Results Monitor have generated 18 upside surprises (34%) against 14 disappointments (26.4%).
Many of those outperformers are enjoying their newfound status of reborn heroes, including AGL Energy ((AGL)), GPT Group ((GPT)), James Hardie ((JHX)), News Corp ((NWS)), and Origin Energy ((ORG)).
Even Aurizon Holdings ((AZJ)) managed to deliver a positive surprise on Monday morning. Banks are thus far the positive surprise package this season, with many A-REITs equally confirming analysts’ positive views beforehand.
For companies labeled software, technology, or growth the headwinds are a whole lot harder to overcome. And as yet again proven by Bravura Solutions ((BVS)), even if the initial share price reaction is positive, the gains booked can disappear just as quickly in the days following.
Last week, I compared this year’s experience with those experienced with IDP Education ((IEL)) and ResMed ((RMD)) in recent years.
Even if the end outcomes lay somewhere in the middle between those two experiences, it’s difficult not to conclude today’s beaten down share prices look too bearishly priced for what possibly awaits on the horizon, including further improvement in AI development.
But this doesn’t by any means imply share prices cannot go lower. These stocks trade on higher multiples with no dividend support. Which, I believe, also made them ideal targets for international hedge funds and shorters, through automated algorithms or otherwise.
In the current context there’s no incentive for institutional investors to start buying either (assuming they too aren’t selling to keep their performance numbers out of the quagmire).
So, apart from owning cyclicals and value stocks, what does one do?
If you’re still on board those sectors for which the momentum pendulum has swung hard in the opposite direction, the big question is always: what if I sell close to the bottom?
You will berate yourself if some time after your decision, the market calms down and share prices put in a strong recovery rally (some are doing exactly that on Monday).
The solution doesn’t need to be black or white. Portfolios can also reduce holdings to stocks that are currently under the pump and that cash can always be re-allocated back down the track.
Nobody enjoys seeing their investments shrink day after day. The ability to sleep at night should never be underestimated.
One subscriber asked me why price targets by brokers are reducing by much smaller percentages in comparison with the heavy falls in share prices. The answer is two-fold.
Current forecasts and price targets are not incorporating the same magnitude of disruption that is currently being priced in. So we’re effectively talking about two different worlds.
One implies business as usual, with maybe, potentially, a little bit of negative impact. The other scenario is one of near annihilation, or at least severely impacted business models.
The second reason is that analysts have no idea what to put through their models in case of worst-case outcomes, which are far less certain than some commentators would have us believe.
For good measure: most analysts are not even contemplating such horror scenario outcomes.
Here’s a snippet from Bell Potter:
“The recent software sell off was indiscriminate, but we see this as overblown and do not believe AI will displace every company.
Instead, we see an AI-augmented future for many software companies.”
Bell Potter’s number one favourite –with conviction– is WiseTech Global. See also last week’s Weekly Insights:
https://fnarena.com/index.php/2026/02/11/behind-the-ai-threat-narratives/
There’s more on this discrepancy in the local share market further below.
February Results, Early Notes
Results seasons in Australia have a slow, elongated warming up phase, as also illustrated by the fact FNArena’s Corporate Results Monitor has only 53 results covered to date (on Monday):
https://fnarena.com/index.php/reporting_season/
The early numbers do look encouraging –more ‘beats’ than ‘misses’– with the banks having mostly surprised to the upside.
But consider by early September the Monitor will consist of something like 380 result assessments, so there’s a lot more to come over the two weeks ahead.
Looking ahead, commodities analysts at UBS see outperformance potential for each of BHP Group ((BHP)), Rio Tinto ((RIO)), and Fortescue ((FMG)).
Specifically for BHP (due to report on Tuesday) UBS anticipates earnings and dividend could beat consensus by 5% and 10%, respectively, reflecting strong realised copper and gold prices.
Elsewhere analysts also provided some background as to why ResMed ((RMD)) shares might have been under pressure recently, observing a high “level of commitment” by the CEO of Philips in the Netherlands to get Respironics’ devices back into the US market, where it competes with ResMed.
As with so many other analysts who cover ResMed and the industry, UBS analysts expressed their confidence ResMed is well positioned to manage this challenge, but in this market no such confidence prevents the sell orders from being executed first.
On Monday, telecom analysts at Citi re-interated their confidence in positive momentum continuing for Aussie Broadband ((ABB)) and Superloop ((SLC)), having analysed app download statistics for January.
In Defence Of Online Classified Portals
Analysts at Wilsons have jumped to the defence of Australia’s two leading online classified portals, REA Group ((REA)) and Car Group ((CAR)).
Both share prices have been under relentless selling pressure and Wilsons argues rapid progress in frontier AI (and investor anxiety about AI disintermediation) has driven a sharp de-rating across tech and online classifieds globally, irrespective of the quality in these businesses.
The AI bear case for classifieds is that AI chatbots become the first stop for search by aggregating listings, reducing the platforms gatekeeper role (with some 80% traffic currently direct).
If direct traffic falls, lead quality/pricing power could weaken especially pay-for-prominence and depth-based ads while referral fees and marketing costs rise, pressuring margins and return on invested capital (ROIC).
Wilsons’ counter-view is that business moats are under-appreciated and under-priced. These include:
(1) brand trust,
(2) deep proprietary datasets,
(3) integrated ecosystems embedded in agent/dealer workflows (high switching costs).
Last week’s report notes the vast majority of traffic remains direct and less than 1% currently originates from ChatGPT.
Wilsons highlights both REA and CAR are embedding AI largely within existing cost envelopes. Examples at CAR include 2x lead uplift from AI search in Brazil and -50% inspection time reduction in Korea, plus a newly announced global AI hub.
The research re-affirms the expectation of low- to mid-teens EPS growth over the medium term remains intact. CAR is preferred.
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A global oriented research exercise by Morgan Stanley, across more than 3,600 companies, acknowledges the overall environment for companies with AI exposure is changing and businesses need to show proof of return on investments made.
While financial markets are trying to identify Winners and Losers, Morgan Stanley analysts lament the indiscriminate selling that is taking place during this process.
Morgan Stanley believes the following stocks are currently mispriced (i.e. too cheap):
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UBS has reviewed the AI traffic debate for online classifieds and run scenarios wherein LLMs become a material referral channel and start charging platforms for traffic.
Important to note: this is not UBS’s base case.
In Australia, UBS estimates some 70% of traffic is direct/app (more protected), circa 25% stems from organic search (most exposed to AI interception), and 5% is paid/other. AI chatbots make up some 0.5% of web traffic today (or 0.3% including apps).
Why this matters now: UBS points to rising app/LLM partnership announcements offshore and notes both Car Group and REA Group have flagged their Australian apps being available through ChatGPT (UBS expects Seek ((SEK)) to follow).
The outcome from UBS’s research exercise is that if -10% of total web traffic shifts to LLMs and is monetised via pay per visit, the estimated average margin erosion would be to the tune of -2ppts by FY30; at 40% share, -7.8ppts average.
The worst case scenario implies up to -12ppts impact for REA.
On cross-stock read-through, REA looks most defensive on direct traffic with currently the lowest AI chatbot share, but the property platform screens as the largest downside in the charging scenario because it has “more to lose” and the highest implied cost per incremental visit in A&NZ.
UBS stays constructive on sector moats and sees scope for a re-rate on the proviso that AI headwinds prove manageable (which it currently expects).
The Weakening USD
One other factor for ASX-listed stocks this year is the weakening trend underneath the US dollar.
Tim Murray, Capital Market Strategist in the Multi-Asset Division at T. Rowe Price, sent the following into the FNArena inbox last week:
I believe there are four primary reasons the US dollar is likely to continue weakening after nearly 16 years of steady appreciation. The recent decline reflects a combination of structural and cyclical forces, suggesting the move may have further to run rather than representing a short-term correction.
First, fiscal concerns are increasingly weighing on the currency. The sheer size of the US national budget deficit is adding pressure to the dollar as debt levels continue to rise.
Second, monetary policy expectations are turning into a clear headwind. Markets are increasingly pricing in the possibility of further interest rate cuts from the Federal Reserve, particularly under the assumption that the incoming Fed chair nominee, Kevin Warsh, may adopt a more accommodative stance than the current Fed chairman, Jerome Powell.
With most other major central banks already nearing the end of their easing cycles, the resulting narrowing in interest rate differentials is causing the dollar to weaken.
Third, political dynamics are influencing foreign demand for dollar assets, as shifts in US foreign policy approaches have led some countries to gradually diversify reserves toward other currencies and gold.
This diversification trend is structurally reducing demand for the dollar, even as it remains the worlds dominant reserve currency.
Finally, global capital flows are acting as an additional drag. When equity markets or asset values outside the US outperform, capital naturally shifts toward those regions.
Gold has also been a key beneficiary of this rotation. From a longer-term perspective, central bank allocations to gold remain below historical highs, suggesting there is still scope for further diversification away from traditional reserve assets.
However, from a valuation standpoint, the dollar also remains elevated relative to its own history and against most major currencies. Even after recent weakness, it is still expensive by historical standards.
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FNArena’s Corporate Results Monitor: https://fnarena.com/index.php/reporting_season/
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