In Brief: Reliance, Bannerman & Codan

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This story features RELIANCE WORLDWIDE CORP. LIMITED, and other companies.
For more info SHARE ANALYSIS: RWC
The company is included in ASX200, ASX300 and ALL-ORDS

Three companies that touch on three major thematics; US tariffs, the growth in uranium demand and rising geo-political risks to create a mix of the bombed out and too hot too handle (?) stocks.

By Danielle Ecuyer

This week’s quote comes from Stephen Innes, SPI Asset Management:

“Goldman’s flow desk is flagging a more subtle shift in behaviour.

“Retail isn’t just leaning into weakness anymore—it’s leaning into the story itself, migrating from the old “buy the dip” reflex to something far more momentum-chasing, a kind of “trade the mania” mindset where narrative outruns price discipline.”

Are Reliance shareholders in for more capital returns and earnings upgrades?

Sifting through the rubble of beaten-up, sold down stocks, Reliance Worldwide ((RWC)) delivered a pleasant surprise for shareholders this week.

With so much going on in 2026, one sometimes must pinch oneself that Liberation Day and the associated US tariff tantrum was just over a year ago.

For companies inside the melee of tariff management, the issue remains front and centre.

Enter Reliance Worldwide ((RWC)) with a more than welcome 3Q26 trading update. As highlighted by Jarden, the update brought forth a confirmation of guidance.

The FY26 net tariff impact stands at the lower end of the prior guidance range of -US$25m to -US$30m.

Jarden points out, post the interim result on February 20, the US Supreme Court “struck down” IEEPA tariffs with a 10% Section 122 levy, expiring July 24, 2026 and subject to extension.

Secondly, Section 232 metal tariffs were changed to tiered rates to full customs entry value based on metal content from April 6, 2026.

With 48% of Reliance’s Americas cost of goods sold sourced overseas before the IEEPA tariffs, there is a possible windfall beckoning through claimed refunds.

The FY26 tariff cost impost is largely reflected in 1H26 earnings, and the impact for FY27 forecasts is lowered to “just” -US$5m to -US$7m, allowing for improved operating leverage and margin expansion over FY27.

Adjusting for mark-to-market prices, including copper at US$13.3k/t and forex changes, EPS estimates are lowered slightly by -2% to -4% for FY26-FY28.

From a valuation perspective, the stock is trading at over 9% free cash flow yield, with Reliance expected to generate double digit EPS growth from FY27-FY30.

The target price implies a price-to-earnings multiple of 12.8x on a 1-year forward basis, representing a slight valuation re-rating.

In terms of capital management, a $56m on market share buyback started on March 5, with Jarden pointing to an average circa $1.9m acquired each day.

Notably, the $120m share buyback FY26 target could be achieved over the balance of 2H26 based on the current rate.

Jarden currently forecasts $80m in 2H26, with the US$15.3m buyback announced at 1H26 results and the $40m in 1H27.

Aligning with management’s goal of returning 40%-60% of net profit after tax, split between dividends and buybacks, there is scope for additional capital returns in 1H27.

Based on the impact of the buybacks, EPS upgrades of circa 3%-4% over FY27 and FY28 seem plausible, assisted by net leverage at the bottom end of the target range.

Reliance Worldwide is rated Overweight with a $4 target.

Bannerman Energy seems to be hitting its straps in the latest quarter

According to Canaccord Genuity, Bannerman Energy ((BMN)) delivered two positives for investors over the March quarter.

As the uranium developer moves forward with its Etango development, management secured funding and a long-term offtake to assist with the move to a final investment decision.

Post completion of the proposed transaction, flagged for mid-2026, CNOL (China Nuclear Overseas), a subsidiary of CNNC (China National Nuclear Corporation), will have a 45% stake in Bannerman (UK), JVCo, through a subscription valued at US$294.5m, with a direct payment to Bannerman of up to US$27m.

The analyst explains post deal, Bannerman has sufficient funds to progress to first production, assuming the most recent pre-production capex forecast of -US$354m, alongside the existing cash balance of $69.9m.

Bannerman will retain a 55% interest in the JVCo, which has a 52.25% interest in Etango, and, as explained by the broker, allows it to appoint three of the five directors at JVCo and nominate three of the five key specified management roles at Bannerman Namibia, including the CEO.

Etango is one of few greenfield U308 developments, and as nations like China seek out longer term supply, the deal secured reflects the changing demand dynamics in the term uranium markets.

For more information see last week’s Uranium Weekly on the current industry dynamics, https://fnarena.com/index.php/2026/04/28/uranium-week-rising-interest-from-utilities/

Importantly, the payment terms with CNOL are “considered to be significantly superior to market standards that are expected to reduce required working capital” according to company management.

Canaccord believes this is a “major” positive, as the uranium sector is typically met with large working capital cycles.

At March end, 66.5% of bulk earthworks were complete, with efforts concentrated on construction of the heap leach pad, and associated ponds and wet plant terraces.

Phase one of the permanent water supply pipeline is around 70% finished and ahead of plans, with 5,509 cubic metres of concrete poured across the primary crusher, stockpile tunnel and fine ore silo, representing around 32% complete across those contracts.

A definitive power agreement has been signed with NamPower, and around 39% of the detailed design of the acid storage and handling facility at Namport is done.

A total of around -$53.6m has been spent on early works at March end, with an additional -$31.4m committed.

The stock remains Speculative Buy rated with an unchanged $5.80 target.

Codan in the sweet spot of higher defense spending 

Codan ((CDA)) gave already happy shareholders another positive fillip this week with an earnings guidance upgrade.

As described by Moelis, the company is in the sweet spot of an “elevated” gold price period, ongoing geopolitical tensions, and higher global defence spending.

Minelab, with gold exposure, continues to perform strongly and is expected to reap the upside from a full FY26 launch of new and upgraded detectors.

Digital technologies and communications revenue and margin saw substantial earnings upgrades, and Communications was the main segment which boosted the guidance upgrade.

According to the company, Communications specialises in mission-critical, secure communications and video transmission.

Robust demand for unmanned systems (drones, robotics), as well as software defined radios (SDRs), was also cited as contributors to higher forecasts.

Margin expansion at Communications infers around 33% 2H26 earnings (EBIT) margin, based on the market update.

The analyst now forecasts a 30% FY26 earnings (EBIT) margin, pulling it forward by some 12 months.

Minelab’s margin is anticipated to remain “stable”.

Moelis retains a Buy rating on the stock, pointing to valuation as the key aspect, with an upgraded target of $48.74 from $42.88 on the back of higher EPS estimates, up 12.1% for FY26 and 9.2% for FY27.

Moelis believes earnings momentum will remain “stronger for longer” with significant upside seen from inorganic growth opportunities (that’s M&A in any other language).

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