Fund Manager Summary on Southern Cross Electrical Engineer Ltd (ASX:SXE)
In February 2026, LSN Capital Partners commented that Southern Cross Electrical Engineer Ltd (ASX:SXE) is experiencing strong order flow across commercial, data centre and resources projects, improving revenue visibility and supporting margin stability. Overall, fund managers view SXE as well positioned to capture structural tailwinds from data centres, battery storage, renewables and broader infrastructure spending, citing a debt-free balance sheet, visible recurring revenue streams and a management team with a consistent record of contract selection, execution and bolt-on acquisitions. Recent commentary places greater weight on near-term revenue visibility and margin stability from active tendering and order wins, while earlier observations flagged the Collie battery project being on track and early signs from the Force Fire acquisition as positive operational developments. Identified risks include project execution and integration risk, reliance on tender market activity and sector valuation cyclicality; actionable considerations are to monitor tender conversion and order book progression, Collie delivery milestones, Force Fire integration outcomes, margin trends and how management deploys balance sheet capacity for further strategic acquisitions.
Commentary From The Managers
There are 10 insights from 8 fund managers regarding their investment in Southern Cross Electrical Engineer Ltd (ASX:SXE) 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
LSN Capital Partners
28 Feb 2026
$3.01
Summary
- LSN Capital Partners believes Southern Cross Electrical is well positioned and continues to hold because the business is seeing strong order flow across commercial, data centre and resources projects, which improves revenue visibility and supports margin stability.
- Order book growth: Recent wins across multiple sectors have materially increased near‑term revenue visibility versus a project‑by‑project pipeline.
- Sector diversification: Exposure to commercial, data centre and resources reduces reliance on any single end market and captures secular demand in data infrastructure and resources investment.
- Margin resilience: A stronger, contracted project mix and confirmed work flow help protect gross margins and reduce earnings volatility.
- Execution focus: Confidence that backlog can be converted to revenue is underpinned by operational capability, project management and supply‑chain oversight.
- Cashflow and flexibility: Improved visibility supports more predictable cash generation and financial flexibility for working capital and selective reinvestment.
- Key risks: Execution delays, supply‑chain or labour constraints, contract pricing pressure and concentrated large projects remain potential downside drivers.
- Catalysts to validate thesis: Continued strong win rates, demonstrable conversion of backlog to revenue, and sustained or expanding margins will reinforce the investment view.
LSN Capital Partners
12 Feb 2026
$2.81
Summary
- LSN Capital Partners believes Southern Cross Electrical is well-positioned to benefit from sustained infrastructure investment and continues to hold, backed by strong end-market conditions and disciplined execution.
- Southern Cross Electrical reported revenue growth of 11% and EBITDA growth of 21%, with FY26 EPS consensus revised upward by 6% following the result.
- As a leading national provider of electrical contracting services across infrastructure, commercial, and resources sectors, the company is a direct beneficiary of structural electrification and construction activity.
- LSN forecasts an EPS CAGR of approximately 16% from FY26–FY28, with the stock trading at an EV/EBITDA of 9.8x on FY26 estimates.
Elston Asset Management
31 Dec 2025
$2.50
Summary
- Elston Asset Management believes SXE is a high-quality, well-managed electrical contractor and continues to hold because diversified revenues, disciplined contract execution and exposure to structural growth tailwinds support sustainable growth.
- Perth-based with Eastern Seaboard operations: national footprint provides access to major resource, commercial and infrastructure markets.
- Well run: long history of successful contract selection and execution drives consistent delivery and effective risk management.
- Diversified revenue mix: balanced exposure across resources, commercial and infrastructure reduces single-market dependency.
- Structural growth tailwinds: positioned to benefit from rising spending on infrastructure projects, data centres and renewables.
- Management track record: proven ability to expand capabilities and enter new markets through targeted bolt-on acquisitions.
- Bolt-on acquisitions: strategic M&A has broadened service offerings and diversified revenue streams while leveraging existing operations.
Clime Investment Management
30 Apr 2025
$1.87
Summary
- Southern Cross Electrical contributed positively to performance in April.
- Investors are recognizing the company's strong earnings momentum.
- Positioned in structural growth areas.
- The Collie battery project is on track.
- Early signs from the newly acquired Force Fire business are promising.
- Tender activity in data centres and battery storage projects remains active, indicating potential near-term upside.
- Holds a debt-free balance sheet.
- Features visible recurring revenue and a conservative earnings base.
- Overall, SXE remains well placed in a sector trading below long-term multiples.
Clime Investment Management
28 Feb 2025
$1.80
Summary
- SXE was a key contributor in the month, delivering standout 1H25 results.
- EBITDA rose 59% year-on-year to $27.1 million.
- Net Profit After Tax (NPAT) surged 68% to $16.2 million, well ahead of forecasts.
- SXE's strong performance was driven by accelerating infrastructure activity.
- A growing pipeline in data centres and energy transition projects supports continued growth.
- With a healthy cash position and ongoing contract wins, SXE remains well-placed for further growth.
- Structural tailwinds in electrification further bolster SXE's prospects.
Monash Investors
30 Sept 2024
$1.84
Summary
- Southern Cross is a leading subcontractor of electricians in Australia.
- Direct beneficiary of the drive to electrify the economy.
- Advantage from significant infrastructure spending by Governments and Corporates.
- Involved in the development of Data Centres, Solar/Wind, and Battery projects.
- Monash Investors invested in Southern Cross earlier in 2024, believing the company is well-positioned for growth.
- Full year results support the investment thesis with continued revenue and earnings growth.
- Growth in order book indicates momentum will continue into FY2025 and beyond.
- Strong net cash balance sheet allows fulfilling contracted operational requirements and supports potential acquisitions.
Ellerston Capital
31 Aug 2024
$1.82
Summary
- SXE demonstrated strong performance with a 6% increase in August, achieving all-time highs.
- Revenues increased by 19% year-over-year, exceeding EBITDA guidance by 5% to reach a record A$40m.
- The main growth driver was the Infrastructure division, with significant projects in Western Sydney Airport, Sydney Metro, and data centers.
- Recurring revenues grew to 17% of total revenue, enhancing the stability of cash flows.
- SXE continues to generate free cash flow, boasting $84.1m in cash and no debt, positioning it with one of the strongest balance sheets among peers.
- Ellerston Capital maintains a high conviction in SXE as part of their portfolio, anticipating further contract wins and potential upside from inorganic growth.
Thorney Investment Group
30 Aug 2024
$1.88
Summary
- Southern Cross Electrical Engineering Limited (ASX: SXE) reported strong operational and share price performance in FY2024.
- The company has maintained a robust order book and opportunity pipeline leading into FY2025.
- Thorney retains a substantial shareholding in SXE.
- There is optimism in the outlook for the company.
Monash Investors
31 May 2024
$1.63
Summary
- Southern Cross Electrical (ASX: SXE) is experiencing strong demand in the electrical contracting sector.
- Recently awarded a $160m contract value for the Collie battery project.
- Made a bolt-on acquisition of a Sydney-based electrical company to enhance growth.
- Updated profit guidance reflects positive market conditions and operational strength.
- Monash Investors continues to hold because of the firm’s strategic developments and growth potential.
Cerutty Macro Fund
31 Aug 2023
$0.80
Summary
- Cerutty Macro Fund holds a position in Southern Cross Electrical, an electrical engineering company.
- The Fund aligns with the view of entering a period of relative scarcity over a previous period of abundance.
- This perspective suggests that margins on electrical and engineering labour are likely to grow and remain above trend.
- Recent results from Southern Cross show an expansion of gross profit margin by 330bps compared to the previous financial year.
- Cerutty Macro Fund continues with a conservative approach during periods of tight market liquidity.
- SXE is categorized in the value basket due to a healthy balance sheet and an undemanding EV/EBITDA of 3x.
The completeness, accuracy or current status of the investments referenced are not guaranteed.
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Frequently Asked Questions
Who is investing in Southern Cross Electrical Engineer Ltd (ASX:SXE)?
Fund managers including Cerutty Macro Fund, Thorney Investment Group, Clime Investment Management, Monash Investors, Ellerston Capital, Elston Asset Management and LSN Capital Partners have invested in Southern Cross Electrical Engineer Ltd (ASX:SXE).
Why do fund managers invest in Southern Cross Electrical Engineer Ltd?
Fund managers invest in Southern Cross Electrical Engineer Ltd due to its strong financial performance, as evidenced by significant year-on-year growth in EBITDA and NPAT. The company benefits from increasing infrastructure activity, particularly in data centres and energy transition projects. With a debt-free balance sheet and visible recurring revenue, SXE presents an appealing risk/reward profile. Additionally, ongoing contract wins and tender activity indicate potential for further growth, while its positioning in structural growth areas adds to its attractiveness.
What happened to Southern Cross Electrical Engineer Ltd (ASX:SXE)?
There have been no recent updates from fund managers regarding Southern Cross Electrical Engineer Ltd although fund managers including Cerutty Macro Fund, Thorney Investment Group, Clime Investment Management, Monash Investors and Ellerston Capital have previously commented.
What is the short interest in Southern Cross Electrical Engineer Ltd (ASX:SXE)?
The short interest in Southern Cross Electrical Engineer Ltd (ASX:SXE) is 0.23% which makes it the 345th most shorted stock on the ASX. Of the 266.0M shares that Southern Cross Electrical Engineer Ltd has on issue, 607.6K have been sold short.
What does Southern Cross Electrical Engineer Ltd (ASX:SXE) do?
Southern Cross Electrical Engineering Ltd. engages in the provision of electrical, instrumentation, communication, and maintenance services. It operates through the Australia geographical segment. The company was founded by Gianfranco Tomasi in 1978 and is headquartered in Perth, Australia.