Fund Manager Summary on Macmahon Holdings Ltd (ASX:MAH)
In January 2026, Forager Funds commented that Macmahon Holdings Ltd (ASX:MAH) had shown sustained operational progress over a decade, its share price doubled in 2025 and at roughly $0.70 looked close to fully valued prompting the fund to reduce its weighting. Overall, fund managers are broadly constructive on Macmahon, emphasising a strong FY25 outcome that met or exceeded expectations, a transformation toward a more capital‑light, higher‑margin mix (underground and civil growing to roughly 23% and 20% of revenue), delivery of $140m free cash flow in FY25, FY26 guidance of $2.6–2.8bn revenue and $180–195m underlying EBITA, a $5.4bn order book and a $24.2bn tender pipeline, and corporate actions including the Decmil acquisition and raised ROACE and dividend targets that underpin earnings and cash‑flow momentum; key risks are the cyclical nature of mining services and commodity exposure, execution and integration risk on large contracts and acquisitions, and valuation sensitivity after the recent rerating; actionable monitoring points are free cash flow and deleveraging progress, order‑book conversion and tender win rates, margin expansion from the shift to underground and civil work, Decmil integration outcomes, and whether management sustains guidance and elevated capital‑return targets through commodity cycles.
Commentary From The Managers
There are 16 insights from 6 fund managers regarding their investment in Macmahon Holdings Ltd (ASX:MAH) available on Thesis Tracker.
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Updates are made available to members within 12 hours of being released. The completeness, accuracy or current status of the investments referenced are not guaranteed.
Commentary From The Managers
Forager Funds
22 Jan 2026
$0.69
Summary
- Forager Funds believes Macmahon's sustained operational progress over more than a decade supports continued ownership and continues to hold because we've owned the stock for more than a decade, observed consistent operational improvements, and expect value from the mining services cycle.
- Long-term ownership: owned the stock for more than a decade with steady operational progress throughout that period.
- Operational performance: management execution and operational metrics have shown sustained improvement for much of the decade.
- Share‑price history: the share price was largely flat through 2025, though it has doubled over the longer term.
- Business profile: remains a mining services company and is therefore cyclical.
- Valuation: at roughly 70‑something cents the stock looks much closer to fully valued.
- Portfolio positioning: the position is now very small within the portfolio given the improved valuation.
Plato Investment Management
5 Jan 2026
$0.67
Summary
- Plato Investment Management believes Macmahon Holdings Ltd is the Australian stock best positioned to benefit from the current commodity cycle and continues to hold because it is a mining services provider that historically outperforms miners in booms, trades at a significant valuation discount and uniquely scores strongly across all five of our core investment pillars while registering zero Red Flags.
- Picks-and-shovels advantage: Providers of mining services tend to deliver superior risk-adjusted returns in commodity booms compared with commodity producers.
- Valuation: Macmahon trades at a material discount to miners, with a forward P/E around 11x, offering an attractive relative entry valuation.
- Quality: Strong scores across our quality metrics and zero Red Flags in our framework point to robust operational and governance characteristics by our assessment.
- Growth: Direct exposure to rising mining activity and contract opportunities supports upside to revenue and earnings as the cycle progresses.
- Momentum: The company’s placement in our momentum pillar reflects improving market recognition and price action consistent with a cyclical recovery.
- Sentiment: Sentiment indicators in our framework are supportive, enhancing the risk-reward profile versus peer miners.
- Rarity of alignment: It is uncommon for a company to score strongly across Valuation, Quality, Growth, Momentum and Sentiment simultaneously—this convergence is a core reason for our continued holding.
Forager Funds
31 Dec 2025
$0.67
Summary
- Forager Funds believes Macmahon’s Decmil acquisition, the string of new contracts and the Byerwen extension position the business to meet FY2026 revenue guidance of $2.6–$2.8 billion, and reduced their position because the rapid rerating in 2025 has materially shrunk the opportunity set and the holding is now less than 1% of the portfolio after gradual sales.
- Decmil acquisition adds civil infrastructure capability and a pipeline of non‑mining work, diversifying revenue and reducing single‑project concentration risk.
- New contracts + Byerwen extension materially improve near‑term revenue visibility and underpin management’s FY2026 guidance.
- Rerating driver: enthusiasm for gold, silver and copper activity propelled the stock higher in 2025, with the share price almost doubling despite a decade of mediocre returns.
- Long‑term stewardship: the Fund owned Macmahon for almost ten years, enduring disappointing returns before the recent commodity‑led upswing.
- Position management: Forager has been gradually selling into strength to manage concentration and crystallise gains, leaving a tactical residual stake under 1%.
- Key risks: execution risk integrating Decmil and delivering contracts, exposure to commodity cycles that drive mining demand, margin pressure from lower‑margin civil work and the possibility that much upside is already priced in.
- Current view: improved revenue certainty and diversification make the business operationally stronger, but the rerating has reduced the Fund’s conviction to retain a larger weighting.
Ellerston Capital
30 Nov 2025
$0.56
Summary
- Macmahon (MAH AU) showed strong performance in November, reducing its valuation discount compared to sector peers.
- All mining services companies are currently benefiting from booming market conditions.
- Management held an Investor Roadshow to emphasize their strong capital allocation discipline and strategic targets.
- Increased business diversity following the acquisition of Decmil (DCG AU) last year.
- Macmahon reaffirmed strong FY26 guidance with projected revenue of $2.6-2.8 billion and underlying EBITA of $180-195 million.
- Supported by a robust $5.4 billion order book and a $24.2 billion tender pipeline, well-diversified across various sectors.
- Recent 34-month contract awarded for underground mining services at PT Freeport's Kucing Liar mine, reinforcing a long-standing customer relationship.
Ryder Capital
15 Oct 2025
$0.48
Summary
- Macmahon Holdings Limited (MAH) is a diversified contractor based in Perth, focusing on mining and civil infrastructure services in Australia and Southeast Asia.
- Strong commodity profile with over 50% of mining services revenue from gold or copper/gold mines.
- Engaged in various mining operations including mine development, ground support, load and haul, and drill and blast.
- The civil segment is benefiting from strong tailwinds in infrastructure and renewable energy sectors, with a growing project pipeline.
- Current CEO Michael “Mick” Finnegan has transformed the business from a ($2m) EBIT(A) loss in FY17 to $171m EBIT(A) in FY25.
- MAH has increased its return on average capital employed (ROACE) target from 20% to 25% and raised its dividend payout ratio from 20-35% to 30-45%.
- Following significant capital investment, MAH is now focusing on a capital light earnings growth strategy, generating $140m of FCF in FY25, with expectations for continued growth.
- The business mix is shifting away from capital-intensive surface mining, with underground revenue growing from 7% in FY18 to 23% in FY25, and civil infrastructure from 3% to 20%.
- Each segment is expected to contribute approximately 1/3 of revenue over time.
- MAH trades at an EV/EBIT(A) of 6x, which is a significant discount compared to peers, despite a strong outlook for earnings growth and cash generation.
Ryder Capital
30 Sept 2025
$0.40
Summary
- Macmahon Holdings constitutes an 8.2% portfolio weight for Ryder Capital.
- The company achieved a 34.2% return during the quarter, reflecting a solid FY25 result at the upper end of guidance.
- Earnings growth has led to an improved return on capital employed.
- The Decmil acquisition, completed over 12 months ago, continues to yield positive results.
- Multiple contract wins announced during the quarter are enhancing the order book for growth in FY26 and FY27.
- Ryder Capital anticipates FY26 to be another strong year for free cash flow generation.
- The company is effectively executing its capital-light strategy.
- As Macmahon secures additional underground and civil contract wins, there is potential for margin expansion.
- Ryder Capital sees a possibility for a rerating closer to its listed peers.
Pendal Group
31 Aug 2025
$0.43
Summary
- Pendal Group continues to hold its position in Macmahon Holdings due to strong performance in the mining and construction sector.
- The company met market expectations with a 20% revenue growth forecast for FY25.
- Macmahon's underlying profit exceeded consensus estimates, indicating robust financial health.
- FY26 guidance suggests revenue and earnings expectations are above market forecasts.
- The company boasts an order book valued at $5.4 billion, providing a solid foundation for future growth.
- Additionally, Macmahon has a tender pipeline estimated at $24.2 billion, highlighting significant future opportunities.
Ryder Capital
31 Mar 2025
$0.28
Summary
- Macmahon fell 20% during the quarter, impacted by a weak equity market and sector derating.
- The positive operational performance of Macmahon continues to meet Ryder Capital's expectations.
- Ryder Capital remains constructive on the outlook for the business.
- Material improvement in free cash flow is expected during 2H25.
- This will drive deleveraging of the balance sheet and strong earnings momentum into FY26.
- Positive outlook over the next 12 months is supported by these factors.
Forager Funds
30 Sept 2024
$0.33
Summary
- Macmahon (MAH) has delivered a solid earnings result this quarter.
- Contract announcements were largely in line with expectations.
- Current management has confirmed guidance achievement.
- The acquisition of Decmil will diversify the business and shift the focus to less capital-intensive work.
- Free cash flow generation remains strong and is expected to continue.
- Forager Funds reduced portfolio weighting in Macmahon to invest in Perenti (PRN), which also reported positive results.
Ryder Capital
30 Sept 2024
$0.33
Summary
- Macmahon gained +12% over the quarter after reporting at the top end of their FY24 profit guidance.
- Generated significant free cash flow, allowing for a healthy increase to their final dividend.
- Strong outlook for further improvement in free cash flow generation over FY25/26, supported by profit growth.
- Opportunities to unlock capital are anticipated moving forward.
- The acquisition of Decmil is expected to create opportunities for incremental earnings growth.
- Diversification of the business into growth sectors such as renewable energy and infrastructure.
- Ryder Capital continues to hold because of these positive indicators for Macmahon Holdings Ltd.
Paradice Investment Management
30 June 2024
$0.27
Summary
- Paradice Investment Management continues to hold an overweight position in Macmahon Holdings (MAH).
- The share price has shown positive rerating, indicating a potential for strong free cash flow outcomes at the FY result.
- MAH was originally purchased at a ~50% discount to Net Tangible Assets (NTA), highlighting deep valuation support.
- Although some of the discount has closed, the stock remains attractive on an earnings/cash flow basis.
- MAH announced its intention to acquire Decmil (DCG) in mid-April, with a shareholder vote scheduled for July 31.
- The acquisition aligns with MAH's stated strategy and is expected to provide significant EPS accretion, scale, and diversification.
- Paradice sees continued value in the mining services sector overall.
- A partial sell-down of the overweight MAH position occurred late in the quarter due to strong share price performance, reallocating into cheaper peers.
Forager Funds
30 June 2024
$0.27
Summary
- Forager Funds continues to monitor Macmahon Holdings Ltd (MAH) following its recent takeover offer for Decmil (DCG).
- The takeover was well received by investors, contributing to a 58% increase in Macmahon's share price prior to the announcement.
- Decmil is viewed as cheap and provides potential franking and tax losses that may be beneficial for Macmahon.
- However, Forager Funds expresses concern as Decmil has not made a profit for several years.
- The engineering and construction sector, which Decmil operates in, is considered tougher than the mining services sector.
- Macmahon has recently resolved its operational issues and doesn't need additional challenges at this time.
- Returning cash to shareholders would have been a preferred strategy.
- Macmahon contributed 2.1% to fund returns for the year, prompting a reduction in exposure to Macmahon.
- Additional investments have been made in Perenti (PRN), which has not experienced the same level of share price appreciation.
Ryder Capital
30 June 2024
$0.27
Summary
- Macmahon Holdings Ltd (MAH) performed strongly, appreciating +87%, more than compensating for previous underperformance.
- MAH delivered strong earnings and free cash flow growth.
- The strategic acquisition of ASX listed civil construction business Decmil Ltd will assist and complement MAH’s capital light business model.
- Despite its near doubling in share price in FY24, MAH still trades materially below intrinsic value.
- Ryder Capital continues to hold and added to Macmahon Holdings Ltd (13.46%) when the stock traded below its net tangible asset value backing.
Ryder Capital
31 Mar 2024
$0.23
Summary
- Macmahon Holdings experienced a significant increase of 22% over the quarter.
- The company reported strong first half results and raised its interim dividend to $0.0045 per share, marking an increase of 50%.
- Ryder Capital expects earnings growth to continue into the second half of the year, supported by robust free cash flow generation following a period of heavy capital investment.
- Management has increased the targeted return on capital to 20% from 15%, which enhances confidence in the business's strength.
- A strong rally in the share price has been observed as a result of these positive results.
- Despite this rally, MAH is still trading well below Ryder Capital's valuation targets, indicating further upside potential.
Ryder Capital
30 Sept 2023
$0.17
Summary
- Macmahon Holdings is our second largest position.
- Currently trades at a steep discount to its intrinsic value.
- Net Tangible Assets (NTA) per share stands at $0.278.
- Recent full-year results were positive and exceeded market expectations.
- The second half of FY23 demonstrated strong margin performance.
- Cash flow generation in FY23 supports our optimistic outlook for FY24.
- Expectations for FY24 include materially higher free cash flow generation.
- Anticipation of a higher return on capital.
- Projected increase in dividends, contributing to valuation enhancement.
- Overall positive sentiment for market valuation and share price performance.
Ryder Capital
30 June 2023
$0.16
Summary
- Price volatility was utilized to increase exposure in Macmahon Holdings Ltd (MAH)
- Ryder Capital remains confident in MAH’s ability to improve margins
- Expectations for earnings growth are high
- Anticipation of strong free cash flow generation in FY24
- Market re-rating of the stock is expected following financial improvements
The completeness, accuracy or current status of the investments referenced are not guaranteed.
Frequently Asked Questions
Who is investing in Macmahon Holdings Ltd (ASX:MAH)?
Fund managers including Ryder Capital, Forager Funds, Paradice Investment Management, Pendal Group, Ellerston Capital and Plato Investment Management have invested in Macmahon Holdings Ltd (ASX:MAH).
Why do fund managers invest in Macmahon Holdings Ltd?
Fund managers invest in Macmahon Holdings Ltd due to its strong operational performance and favorable growth prospects. With a robust order book valued at $5.4 billion and a significant tender pipeline of $24.2 billion, Macmahon is well-positioned for revenue and earnings growth. The company has demonstrated a successful transition towards higher-margin underground and civil infrastructure services, which are expected to enhance profit margins. Additionally, improved free cash flow and an increased dividend payout ratio underscore its solid financial health and appealing risk/reward profile.
What happened to Macmahon Holdings Ltd (ASX:MAH)?
Fund managers have invested in Macmahon Holdings Ltd due to its robust growth prospects and strong operational performance, evidenced by significant improvements in earnings and free cash flow generation. The company's strategic shift toward higher-margin underground mining and civil infrastructure, along with its diversified client base and sizable order book, supports a favorable outlook for ongoing revenue increases. Recent acquisitions have bolstered contract wins and the firm's return on average capital employed has been enhanced, further closing the valuation gap compared to peers. With a solid pipeline of future projects and an empowered leadership team, Macmahon is positioned for sustained profitability and shareholder returns.
What is the short interest in Macmahon Holdings Ltd (ASX:MAH)?
The short interest in Macmahon Holdings Ltd (ASX:MAH) is 0.01% which makes it the 521st most shorted stock on the ASX. Of the 2.2B shares that Macmahon Holdings Ltd has on issue, 303.0K have been sold short.
What does Macmahon Holdings Ltd (ASX:MAH) do?
Macmahon Holdings Ltd. engages in the provision of mining activities. It offers Surface mining, underground mining, and mining support and civil infrastructure. The company was founded on August 5, 1963 and is headquartered in Perth, Australia.