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ASB: AI Digital Twin Expansion Will Support Stronger Long Term Earnings Potential

Rising Global Demand For Naval Vessels Will Accelerate Green Shipbuilding

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ASB
AnalystHighTarget
Not Invested
Published 11 Jul 2025

Update shared on 12 Dec 2025

Fair value Increased 1.25%
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AnalystHighTarget's Fair Value
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1Y
105.9%
7D
-2.8%

Analysts have nudged their price target on Austal slightly higher to reflect a modest improvement in fair value to around $8.10 per share. This is supported by expectations of slightly faster revenue growth and a richer future earnings multiple, despite some pressure on margins and a marginally lower discount rate.

What's in the News

  • Austal is partnering with Edge Total Intelligence and Sabel Systems to showcase an AI Powered Digital Twin Pavilion at the Smart Cities Connect Fall Conference and Expo in National Harbor, MD, focusing on contested logistics, smart cities and bases, and infrastructure risk management (company announcement)
  • Solutions featuring Austal's involvement will highlight how AI driven technologies can enhance public shipyard and depot operations, underscoring the shipbuilder's push into advanced digital and AI enabled maritime support capabilities (company announcement)
  • A separate macro development sees Associated Banc Corp lowering its prime rate to 7.25 percent from 7.50 percent, a move that may modestly affect financing conditions across the broader industrial sector (periodical)

Valuation Changes

  • Fair Value has risen slightly, with the intrinsic value estimate increasing from A$8.00 to A$8.10 per share.
  • Discount Rate has edged lower, moving from 7.36 percent to about 7.34 percent, modestly supporting a higher valuation.
  • Revenue Growth has improved, with the medium term forecast increasing from roughly 19.7 percent to about 20.9 percent per year.
  • Net Profit Margin has fallen noticeably, with the long run margin assumption reduced from about 7.1 percent to roughly 5.9 percent.
  • Future P/E has risen meaningfully, with the forward earnings multiple moving from about 23.0x to roughly 27.2x, indicating a richer valuation basis.

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Disclaimer

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