Stealth Group's Acquisition Quietly Turned 32 Locations Into 1,200

A clean earnings beat grabbed the headlines, but the real story is a transformative acquisition setting up ambitious FY28 sales and margin targets.

31 Aug 2026 · 3 min read

Stealth Group Holdings jumped almost 32 percent in a single session in June after preliminary FY26 numbers beat expectations, but the more interesting story is how a landmark acquisition transformed the hardware distributor's network from 32 to more than 1,200 locations almost overnight, setting up ambitious FY28 targets fund managers increasingly believe are achievable.

A transformative acquisition expands the network 37-fold

Wilson Asset Management described Stealth Group as a diversified, multi-channel distribution business supplying industrial, hardware, safety and consumer products to trade and retail customers across Australia, with the share price rising sharply after the company announced the acquisition of Hardware & Building Traders, Australia's largest privately owned hardware and industrial buying group, a transaction that significantly increased its network reach. Phoenix Growth Fund said it had been adding significantly to Stealth Group, which would become a new top 10 position in the fund.

A clean earnings beat masks a bigger transformation

Tamim Funds Management called Stealth Group a clean example of a familiar pattern: on 17 June the company released preliminary FY26 numbers, shares jumped almost 32 percent in a session, and most commentary focused on the earnings beat, the good-result story. Tamim argued the more interesting story is what the business has quietly turned into, a distributor and retailer of hardware, industrial, safety and related consumer products that looked very different just a year earlier.

That is the good-result story. The more interesting story is what the business has quietly turned into.

— Tamim Funds Management, Article, July 2026

The numbers behind the network expansion

Wilson Asset Management said a strategy and trading update on 17 June 2026 reaffirmed previous guidance for another record year, with FY2026 preliminary unaudited net profit after tax of $5.8 million exceeding expectations, alongside reiterated long-term targets for annual sales of $500 million. Tamim Funds Management detailed the preliminary FY26 update showing sales up 13.7 percent to $165 million, EBITDA up 44.4 percent to $14.3 million and net profit up 87.1 percent, driven by the Hardware & Building Traders acquisition, which expanded the company's network from 32 to more than 1,200 locations. Tamim expects an operational step-change in FY27 and believes the stock will re-rate as the market gains confidence in FY28 targets of $500 million in sales and an 8 to 12 percent EBITDA margin. Wilson Asset Management's annual report described Stealth Group as a founder-led business-to-business wholesaling and distribution company, with the Hardware & Building Traders acquisition expanding its ability to provide centralised ordering and distribution services to independent businesses, improving efficiency and scale as it works toward those ambitious targets.

Sales up 13.7% to $165m, EBITDA up 44.4% to $14.3m and NPAT up 87.1%, driven by the Hardware & Building Traders acquisition, which expanded its network from 32 to over 1,200 locations.

— Tamim Funds Management, Monthly Report, June 2026

What fund managers say they are watching next is delivery of the operational step-change expected in FY27 as the expanded network beds in, progress toward the ambitious FY28 targets of $500 million in sales and an 8 to 12 percent EBITDA margin, and whether market confidence in those targets continues building to drive a further re-rating.