Fund Manager Summary
The fund managers believe that the outlook for Resouro Strategic Metals CDI is promising, particularly due to its high-grade rare earths and titanium mineral opportunity at the Tiros project in Brazil. In their opinion, the company is well-positioned for growth, supported by CEO Chris Eager's experience in successfully developing mining projects, including the notable sale of Monterrico Metals for US$200m. The recent IPO, which raised $8m and established a $44m enterprise value, positions the company favorably for future developments. Fund managers are optimistic about the upcoming maiden resource and metallurgical test work, which they believe will further de-risk the project and enhance investor confidence.
Source: Trading View
Commentary From The Managers
Tamim Funds Management
4 Sept 2025
$3.93
Summary
- Tamim Funds Management has tracked Johns Lyng Group (ASX: JLG) closely for years.
- Initially, the stock was priced to perfection, making it hard to justify an investment.
- Market sentiment soured on small caps, leading to a significant decline in JLG's stock price.
- By February 2025, JLG's stock had halved, trading at $2.00.
- Insider buying by management signaled confidence in the business.
- After a deep-dive management meeting, Tamim Funds Management initiated a position at $2.20.
- The investment thesis was based on core strengths: founder-led structure, industry leadership, strong balance sheet, and improving fundamentals.
- In July, Pacific Equity Partners made a $4.00 per share offer, valuing JLG at $1.1 billion.
- This acquisition represented an 82% premium to Tamim's entry price.
- The deal reflects a broader trend of interest in quality small caps with temporary earnings issues.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Commentary From The Managers
Tamim Funds Management
4 Sept 2025
$3.93
- Tamim Funds Management has tracked Johns Lyng Group (ASX: JLG) closely for years.
- Initially, the stock was priced to perfection, making it hard to justify an investment.
- Market sentiment soured on small caps, leading to a significant decline in JLG's stock price.
- By February 2025, JLG's stock had halved, trading at $2.00.
- Insider buying by management signaled confidence in the business.
- After a deep-dive management meeting, Tamim Funds Management initiated a position at $2.20.
- The investment thesis was based on core strengths: founder-led structure, industry leadership, strong balance sheet, and improving fundamentals.
- In July, Pacific Equity Partners made a $4.00 per share offer, valuing JLG at $1.1 billion.
- This acquisition represented an 82% premium to Tamim's entry price.
- The deal reflects a broader trend of interest in quality small caps with temporary earnings issues.
Summary
Contact Asset Management
31 July 2025
$3.90
- Contact Asset Management notes that Johns Lyng Group Ltd (JLG) received a non-binding takeover proposal from Pacific Equity Partners.
- The official bid was made in July at $4.00/share via Scheme of Arrangement.
- Despite JLG's stock doubling from April 2025 lows, the bid is perceived as opportunistic given the company's ongoing challenges with major contracts.
- Recent performance of JLG has been positive for the Fund.
- Contact Asset Management continues to hold its position in JLG as it evaluates the implications of the takeover proposal.
Summary
Monash Investors
31 July 2025
$3.90
- Johns Lyng rose 24% in July following a confirmed privatisation price of $4 per share.
- Monash Investors initially invested when Johns Lyng was entering the US market, which presented significant opportunities.
- Performance did not meet expectations, leading to scaled down holdings and eventual exit in mid-2024.
- Share prices fell from mid-$3 to ~$2.20, shifting sentiment from extreme optimism to unjustified pessimism.
- Monash Investors began rebuilding a position in April at $2.20 and expanded to a full 4% weighting at $2.80 after a going-private announcement.
- Initial announcement did not specify a price, but Monash believed it would be higher than $2.80.
- Stock contributed positively in June and reached ~$3.90, adding 1% to NAV in July.
- Position was reduced from over 5% to around 3% for portfolio liquidity to explore other opportunities.
- Experience with Johns Lyng underscores the importance of cutting losses when a thesis is broken, while also highlighting the potential for revisiting investments.
- Demonstrates how private equity interest in smaller cap companies can create opportunities for investors.
Summary
Ellerston Capital
31 July 2025
$3.90
- In July, Johns Lyng Group (JLG AU) received a takeover offer from Pacific Equity Partners (PEP) at A$4.00 per share.
- This offer represented a 57% premium to the last traded price prior to the proposal.
- JLG was a key holding in Ellerston Capital's portfolio, initiated after significant share price weakness following February results.
- Ellerston Capital believed the market had overreacted to short-term challenges, particularly the U.S. business's performance.
- The stock was trading near Ellerston Capital's bear case valuation, presenting an attractive entry point.
- JLG was seen as trading at a meaningful discount to its long-term valuation and unlisted transactions.
- With the impending delisting from the ASX and the stock trading near the bid price, Ellerston Capital decided to exit their position.
Summary
Tamim Funds Management
31 July 2025
$3.90
- Johns Lyng Group (ASX: JLG) has entered into a Scheme Implementation Deed with Sherwood BidCo Pty Ltd, managed by Pacific Equity Partners (PEP).
- PEP is set to acquire 100% of JLG shares at $4.00 per share, valuing JLG's equity at approximately $1.1 billion.
- JLG is considered a classic Tamim Funds Management stock pick.
- Previously, JLG traded at elevated levels, making it difficult to see value.
- Despite being a popular stock among fund managers, it carried a highly expensive multiple.
- Over the past year, the company experienced multiple downgrades due to lower industry activity.
- Disappointing February 2025 results led to a stock decline, reaching lows of $2.00.
- After observing management acquire shares on the market, Tamim Funds Management initiated a position at $2.20.
- JLG meets key criteria for investment: founder-led, industry leader, solid balance sheet, positive outlook, and undemanding valuation.
- In June/July, the company agreed to a takeover at a premium of $4.00 compared to the entry price of $2.20.
Summary
QVG Capital
31 July 2025
$3.90
- Johns Lyng Group Ltd received a takeover offer from Pacific Equity Partners at $4.00 a share.
- The offer resulted in a 23% increase in stock value for the month.
- QVG Capital believes PEP is acquiring JLG at an attractive price.
- Despite recent poor performance, QVG Capital continues to hold JLG due to cyclical factors related to extreme rainfall in CY22.
- The bid has management and board support, making completion highly likely.
- QVG Capital acknowledges the bittersweet nature of the situation with a sentiment of C’est la vie JLG!
Summary
Forager Funds
31 July 2025
$3.90
- Forager Funds sold their investment in Johns Lyng (JLG) due to fewer buildings needing restoration from good weather over the last year, which impacted profitability.
- Before a potential recovery could be seen, the company agreed to a takeover from private equity player PEP at $4 per share.
- This price represented a 57% premium to the share price before the announcement.
- The investment was profitable, as it was nearly double the Fund’s entry price just three months prior.
- A shareholder vote to approve the takeover is expected in October.
Summary
Asymmetric Asset Management
30 June 2025
$3.17
- Asymmetric Asset Management established and increased its holding in Johns Lyng Group, a leader in insurance building restoration.
- The fund previously held Johns Lyng in 2019 but sold out as the company became a "market darling" with high growth expectations.
- A series of downgrades led to a shift in perception, changing Johns Lyng's status from favored to unloved in 2024/25.
- Despite the negative outlook, Asymmetric Asset Management identified value, believing the market was overly pessimistic.
- After increasing the position size, Asymmetric Asset Management saw a positive return, with the stock rising approximately 24% following involvement from Pacific Equity Partners and founder Scott Didier.
Summary
Monash Investors
30 June 2025
$3.17
- Monash Investors recently reintroduced their portfolio holding in Johns Lyng Group.
- Previously, the investment thesis was based on expectations for US growth, which did not materialize, leading to a significant decline in share value.
- The market shifted from optimism to pessimism, overlooking the company's valuable Australian operations.
- After a 60-70% de-rating, Monash Investors began rebuilding their position in May at approximately $2.20 per share.
- In June, a proposed private equity-led takeover was announced, causing shares to initially rise above $3 but settle around $2.80.
- The current market reflects a heavy discount on uncertainty, yet Monash Investors believes shares are supported by underlying fundamental value in the high $2 range.
- There is a reasonable chance the takeover deal will proceed, potentially at a price higher than the current market value.
- This situation presents an asymmetric payoff potential, with estimated upside of 3-4 times compared to downside risks in the $2.80 range.
Summary
Forager Funds
30 June 2025
$3.17
- Johns Lyng Group Ltd (JLG) is a recent addition to Forager Funds' portfolio.
- Known for building restoration services, historically benefiting from weather-related insurance work.
- Recent mild weather conditions turned a tailwind into a headwind, impacting growth.
- Missteps in US expansion and a slower pace of acquisitions contributed to cooling growth.
- Once a darling stock, JLG's share price fell 75% from mid-2022 to March 2023.
- JLG was removed from the S&P/ASX 200 index, reflecting its fall from grace.
- Forager Funds believes JLG's fundamentals remain strong despite recent challenges.
- The company has a solid industry position and a long track record of growth.
- Private equity interest, indicated by a non-binding offer, reinforces the quality of the business.
- Even if the bid does not materialize, the current price is considered attractive.
- JLG's share price has increased 45% in the interim.
- These developments contributed 4.6% to Forager Funds' portfolio performance for the year.
Summary
BKI Investment Company
30 June 2025
$3.17
- BKI Investment Company established a small position in Johns Lyng Group (JLG.ASX).
- JLG is a leading provider of building and restoration services across Australia.
- The company specializes in repairing properties damaged by insurable weather events, such as flood and fire.
- Over 80% of JLG's revenue is generated from its Insurance Building and Restoration Services segment.
- JLG works with insurers and brokers on a cost-plus basis.
Summary
Langdon Equity Partners
30 June 2025
$3.17
- Johns Lyng Group is recognized as a leading provider of insurance building restoration, commercial construction, and disaster recovery services.
- Despite previous underperformance, the company has shown a significant re-rating in its share price, increasing by over 40% in the last quarter.
- Langdon Equity Partners has decided to increase their investment in Johns Lyng Group considerably during this period.
- The company is currently in discussions regarding a potential take-private situation, which was formalized after the quarter ended.
- Langdon Equity Partners anticipates providing further updates leading up to the shareholder vote in November.
- What was previously viewed as a negative contributor to fund returns has transformed into a meaningfully positive return since inception.
- The fund has achieved nearly 100% return from its last significant investment in Johns Lyng Group several months ago.
Summary
QVG Capital
30 June 2025
$3.17
- Johns Lyng confirmed they received a takeover offer from private equity investor PEP.
- The price of the offer is yet to be disclosed.
- QVG Capital anticipates the offer to be materially north of the current share price.
- An update on the situation is expected in mid-July.
- QVG Capital continues to hold due to the potential upside from the takeover.
Summary
Lanyon Investment Fund
31 Mar 2025
$2.14
- Lanyon Investment Fund has acquired shares in Johns Lyng Group (ASX: JLG).
- JLG is a founder-led company that was once a small-cap market darling, known for its premium valuation.
- It is recognized as Australia’s leading integrated building services provider, offering building, restoration, and strata services on both national and international levels.
- The market appears to be cautiously pricing in a continuation of recent benign weather events and slower growth in the US.
- There is speculation regarding private equity interest in JLG, which Lanyon Investment Fund finds unsurprising due to the steep discount and its highly defensive, non-discretionary earnings profile.
Summary
Longwave Capital
28 Feb 2025
$2.55
- Longwave Capital identifies Johns Lyng as the worst underperformer during reporting season.
- This is a capital-light business model with a large potential total addressable market.
- Growth has been largely driven by acquisitions, complicating the visibility of true historical organic growth.
- Guidance for the full year was downgraded by mid single-digits, necessitating significant 2H earnings improvement.
- The first half earnings miss was large, with organic growth being the biggest disappointment.
- The new growth pillar in the USA has not yet proven the ability to grow at double-digit organic growth rates.
- Longwave Capital had anticipated the lack of organic growth in Australia due to the business model focusing on acquisitions.
- The USA business is struggling to achieve the promised double-digit organic growth rate.
- Longwave Capital believes that execution may improve in the USA, though it is often more challenging than theoretical models suggest.
Summary
Contract Asset Management
31 Oct 2024
$3.83
- Contract Asset Management added Johns Lyng (JLG) to the portfolio in early October.
- JLG is an integrated building services group operating in Australia and the US.
- Core business focuses on restoration services after insurable events such as weather and fire.
- The company operates on a cost-plus basis and has a solid pipeline of work.
- Expansion in the United States is expected to drive meaningful growth.
- JLG also has a sizable strata management business.
- The company is founder-led and is net cash.
- Well poised to deliver doubledigit earnings growth in the coming years.
- Reported a slightly softer-than-expected trading update in August, leading to a stock sell-off.
- Contract Asset Management views the share price weakness as an attractive entry point.
- JLG has been trading on a mid-20x P/E multiple, reflecting sound growth prospects.
- Currently buying the stock at approximately 14x next year’s earnings, viewed as compelling.
- Expecting to benefit from a growing dividend stream.
Summary
QVG Capital
31 Aug 2024
$3.65
- Johns Lyng guided to adjusted earnings approximately 14% below consensus expectations.
- The stock fell significantly as the market questioned organic growth levels.
- An underperforming NSW division and poor cash flow contributed to market concerns.
- Weather events (storms, floods) heavily impact JLG’s core and catastrophe business.
- A period of dry weather from January affected both core and disaster recovery divisions.
- JLG's earnings exhibit climate sensitivity, previously underestimated.
- The soft second half and recognition of over-earning in FY23 & 1H24 led to a significant de-rate in share price.
- Directors have responded by buying stock, indicating confidence.
- JLG is likely to remain under scrutiny until a return to organic growth is demonstrated.
Summary
Endeavor Asset Management
31 Aug 2024
$3.65
- Endeavor Asset Management revisited their investment thesis following JLG's weaker FY24 earnings report.
- JLG's stock fell 37% by the end of August, closing at $3.75 per share from $5.97 in July.
- The company's guidance indicated a soft FY25, leading to downward revisions in consensus estimates.
- Valuation multiple derating occurred as market expectations were not met.
- Looking ahead, FY26 may present a significantly stronger outlook for JLG.
- Directors purchasing shares on the market post-results is a positive sign.
- Endeavor Asset Management remains cautious, sitting on the sidelines due to short-term volatility and lack of near-term growth.
Summary
Monash Investors
31 Aug 2024
$3.65
- Monash Investors noted a significant drop of 35% in Johns Lyng Group's shares after disappointing full-year results.
- Johns Lyng is recognized as a leading building services and disaster recovery company in Australia.
- The company has been attempting to expand into the US market, supported by a strong performance in Australia.
- Despite earlier confidence, Monash Investors reduced their holding in the company following initial poor results indicating challenges in the US market.
- This reduction was part of a strategy to protect capital and mitigate any personal bias towards the stock.
- After the August results fell significantly short of expectations, Monash Investors decided to exit their remaining position.
- The decision was based on the realization that the original thesis regarding US growth was not materializing.
Summary
Endeavor Asset Management
31 July 2024
$5.96
- Endeavor Asset Management sold their investment in Johns Lyng Group (JLG) due to elevated risk surrounding market expectations on the US strategy.
- The fund manager remains positive on the long-term thesis associated with Australian market share gains.
- There is potential for growth into new regions, but current risks prompted the exit.
- Endeavor plans to revisit Johns Lyng following the release of their earnings later this month.
- Concerns were raised that earnings may miss market expectations.
Summary
QVG Capital
28 Feb 2024
$6.58
- QVG Capital continues to hold a position in Johns Lyng Group Ltd.
- The focus is on assessing the likelihood and timing of an earnings recovery, which management forecasts for the second half.
- Despite the second half skew, there is an expectation for organic growth and cash flow improvement.
- Current stock prices reflect a market multiple for below par earnings while representing an above par business.
Summary
Ausbil
31 Jan 2024
$6.81
- Johns Lyng Group (JLG) returned +11.3% over the month.
- Severe weather events in North and South-East Queensland may increase JLG’s catastrophic weather event backlog.
- Previously anticipated decline in work volume due to El Niño cycles is likely to be offset.
- JLG is well placed to continue its strong trajectory both in Australia and internationally.
- Ausbil continues to hold JLG as it has several opportunities currently being explored.
Summary
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
ANALYST INSIGHT
Equity Research Analyst
"Emerging from the shadows of the rare earths market, the Tiros project seems poised for a significant leap. With seasoned leadership at the helm, Resouro Strategic Metals appears to be on the brink of unlocking substantial value for investors."
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Frequently Asked Questions
Who has invested in Johns Lyng Group Ltd (ASX:JLG)?
Fund managers including Endeavor Asset Management, Monash Investors, Longwave Capital, Ausbil, Contract Asset Management, QVG Capital, Asymmetric Asset Management, Forager Funds, Lanyon Investment Fund, Langdon Equity Partners, Contact Asset Management, BKI Investment Company, Ellerston Capital and Tamim Funds Management have invested in Johns Lyng Group Ltd (ASX:JLG).
Why have investment managers invested in Johns Lyng Group Ltd (ASX:JLG)?
Fund managers have invested in Johns Lyng Group Ltd (JLG) due to its strong long-term growth potential in the Australian market and expansion into new regions. Despite some concerns regarding short-term risks associated with market expectations on its US strategy, the overall thesis remains positive. Fund managers, like Endeavor Asset Management, recognize the company's ability to gain market share in Australia, which supports their investment rationale. They plan to reassess their positions after upcoming earnings reports to evaluate the company's performance against market expectations.
What happened to Johns Lyng Group Ltd (ASX:JLG)?
There have been no recent updates from fund managers regarding Resouro Strategic Metals CDI although fund managers including Endeavor Asset Management have previously commented.