ARB CORPORATION LIMITED (ARB)
Share Price Analysis and Chart

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25/02/2026

1

Overweight

$28.00

31.70%

Morgan Stanley lowers its target for ARB Corp to $28 from $44 and reiterates the Overweight rating, while lowering EPS forecasts by -14.7% for FY26 and -13.1% for FY27. The stock's valuation is seen as "compelling" post the de-rating to 5yr-plus lows.

The broker highlights resilient relative performance, in Australia and UK markets with significant US runway, including store-in-store expansion, dealer activations across the 4WP/ORW network, broader distribution opportunities and the Poison Spyder relaunch.

Model changeovers, weaker offshore system sales and lower EMEA aid and relief spend have weighed on earnings, but these factors are viewed now as largely reflected in the base.  

Morgan Stanley views cyclical pressures as better understood and structurally supportive drivers intact.

****

On first look, ARB Corp announced a notable preliminary 1H26 miss, with the second quarter experiencing a slowdown across all businesses, Morgan Stanley explains.

Sales of $358m fell -1% y/y, some -7% below consensus, which infers around a -6% miss in 2Q26 on growth of 3.8% in 1Q26.

Profit before tax at $58m missed consensus by -14%, and cash conversion came in at around 85%. Australia aftermarket sales slipped -1.7%, with 1Q26 growth of 1% pointing to a 2Q26 decline of -4.4%.

The US remained upbeat with 26% sales growth, but the rest of the world slowed down, with a sizeable moderation in 2Q26 which counters the 1Q and AGM management outlook.

The analyst is seeking more details at the 1H26 results on Feb 24, particularly in relation to the negative surprise from exports in 2Q26.

Overweight. Target unchanged at $44. Industry View: In-Line.

FORECAST
Morgan Stanley forecasts a full year FY26 EPS of 107.00 cents.
Morgan Stanley forecasts a full year FY27 EPS of 124.00 cents.

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12/03/2026

3

Hold

$22.90

7.71%

Canaccord Genuity notes ARB Corp's top 11 index grew 0.7% in February on the prior year, revealing some signs of stabilisation after a period of negative growth.

Ranger and LC300 saw growth, with an expectation Toyota Hilux deliveries are set to improve with new model releases.

Hold rating and $22.90 target unchanged.

FORECAST
Canaccord Genuity forecasts a full year FY26 dividend of 64.00 cents and EPS of 106.00 cents.
Canaccord Genuity forecasts a full year FY27 dividend of 66.00 cents and EPS of 110.00 cents.