“But I think a lot of this talk [about AI] will be with us for the next little while because the numbers are just so staggeringly big.
“It might be a year or two before we have complete clarity over whether the immense investment that we’re seeing does indeed pay dividends,” Lister said.
Closer to home, shares in Australian data centre operator NextDC dropped by 40% on Wednesday after warning investors that it would miss earnings forecasts.
The stock bounced back a little yesterday, trading at A$5.68 ($6.91) – up 6% on the day.
NextDC announced reduced fiscal 2027 guidance of 22% to a midpoint of A$487.5 million for net revenue, 36% to a midpoint of A$255m for adjusted earnings before interest, tax, depreciation and amortisation (ebitda), and 14% to a midpoint of A$4750m for capex, reflecting delays to electricity network upgrades supplying its M3 site.
Morningstar senior equity analyst Dan Baker said the selling was overdone because NextDC’s assets, both current and planned, are still in demand.
“We see it as undervalued at these levels,” Baker said.
“Community concerns over data centres may increase developer costs and force new data centres further away from built-up areas.
“However, this will affect all developers, will likely be factored into new contracts and will likely make existing data centres even more valuable.”
Lodestone debut
Solar power company Lodestone Energy debuted on the NZX at a 10c premium to its $2.25 issue price before easing back a touch.
Going by NZX filings, Jarden – and its related parties – has about 26% of the stock.
Trade Me founder Sam Morgan’s JIT Hillend Investment has 12.4%.
Sir Stephen Tindall’s K1W1 has 6.6% and Lodestone managing director Gary Holden has 6.5%.
Lodestone is the first company of any significant size to debut on the NZX in five years.
The company said the offer attracted a broad mix of about 10,000 investors, with almost half of the capital raised coming from new retail investors and the remainder from institutional investors and existing shareholders.
Mixed bag
Craigs Investment’s Lister said annual meeting commentaries so far had been solid, but highlighted a “mixed bag” in terms of the state of the economy.
“There are some good signs, but it’s not across the board.”
Skellerup, at its annual meeting, has guided to 2027 net profit of $67m-$72m, implying growth of 8.3% at the midpoint on 2026.
First-quarter net profit was 15% on the prior year, with demand strong across most applications, particularly in the industrial division.
“We are currently above the upper end of this range ($72.5m) and ahead of consensus ($72.3m),” brokers Forsyth Barr said in a report.
“We are comfortable being above Skellerup’s range given its traditional conservatism, having delivered reported net profit above the midpoint of first-time guidance in eight of the last nine years.”
Ebos reassures
Ebos group provided a reassuring update at its annual meeting, reiterating both its 2027 operating profit and its implied net profit guidance.
“Although no quantitative group first quarter 2027 ebitda (earnings before interest, tax, depreciation and amortisation) growth was provided, it did give some useful colour across its divisions,” Forsyth Barr said.
“On the positive side, branded Animal Care revenue is still growing solidly, the impact from Australian pharmacy distribution industry funding changes has been largely as expected, and there was a short extension to its NZ Chemist Warehouse contract,” the broker said.
“Offsetting this have been higher fuel-related costs, impacting margins, and foreign exchange continuing to move adversely.”
Ebos’ guidance and commentary continue to point to a subdued first-half 2027 result and a much stronger second half.
Vulcan up
Vulcan Steel reported a strong trading update at its annual shareholder meeting (ASM), with headline ebitda up 51% on the prior year.
This was boosted by the acquisition of Roofing Industries, which continued to contribute strongly.
Excluding roofing, underlying ebitda was still up 21%, with solid growth from both the Steel and Metals divisions.
A fish out of water
Shares in seafood company Sanford have fallen sharply over the last five months.
This week, the stock traded at just over $6.00 from $8.15 in May.
Forsyth Barr believes the decline reflects concerns about potential fishing reforms ahead of the November 7 general election.
The Opportunity Party is currently in the kingmaker seat and its reform of bottom trawling is a coalition bottom line, it said.
“We view the potential near-term impact as modest, given the type of bottom trawling being restricted accounts for just 4% of Sanfords’ wildcatch volumes, with our estimate of group revenue and net profit exposure in the low single digits.”
More significant fishing reform may also run into Treaty settlement complications, Forsyth Barr said.
“Our focus remains on near-term trading, with our database updates suggesting a mixed performance in wildcatch, strong salmon trends, and ongoing challenges for mussels.
“That said, Sanfords’ 2026 result should be supported by strong cash conversion as it sells down excess mussel stock, resulting in a further reduction in net debt.
“We view the risk–reward as attractive, with a 12-month forward price earnings ration of eight times – 45% below the market median and 28% below its long-run average, despite the meaningful strides the business has made to improve returns.”
Forsyth Barr rated Sanford as “outperform”.
The seamount-associated species (orange roughy, oreos, alfonsino, black cardinalfish, bluenose, and rubyfish) represent just 4% of Sanford’s wildcatch volumes.
“Of greater concern would be restrictions extending to higher-value scampi, typically caught on flat, muddy seabeds rather than seamounts,” Forsyth Barr said.
The party’s proposal does not explicitly prohibit fishing across all such grounds, although its wider restrictions on vulnerable seabed habitats leave the potential exposure uncertain.
Treaty settlement obligations add complexity to implementation of large-scale fishing reform, it said.
Jamie Gray is an Auckland-based journalist, covering the financial markets, the primary sector and energy. He joined the Herald in 2011.
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