Enero Group has lost more than half its market value in a year and slashed its dividend, yet the marketing and technology group still yields close to 7.7%. With full-year results due on 21 August, is the worst behind it?

The pitch, and the problem

Enero Group Limited (ASX: EGG) is a small Australian-listed group of marketing, communications and technology agencies. Its shares changed hands at about 30 cents on 31 July 2026, valuing the company at roughly A$27 million — firmly micro-cap territory. That price is down about 56% over the past year and around 70% below its 2022 peak. On the trailing 12 months of declared dividends (2.3 cents, fully franked), the stock offers an indicative yield of about 7.7% — the kind of number that draws income hunters, and also the kind that often signals the market expects further cuts.

What Enero actually does

Following a major portfolio change in 2025, Enero now runs three continuing agency brands: Hotwire Global (technology public relations), BMF (a Sydney creative advertising agency) and Orchard (digital and customer experience), alongside US performance-marketing brand ROI·DNA. The group employs several hundred people across Australia, the United States, the United Kingdom and Europe, and is led by chief executive Ian Ball. Enero reports these operations under a single "Technology, Healthcare and Consumer" practice.

The catalyst: life after OBMedia

The defining event of the past year was the exit from OBMedia. In July 2025 Enero sold its 51% stake in the US programmatic-advertising business to the unit's minority shareholders for a nominal amount, booking a loss of about A$16.7 million (roughly A$14.5 million of it non-cash). OBMedia had once been the group's profit engine, contributing an estimated A$24 million of EBITDA in FY24, but its earnings collapsed after Google reworked the advertising products the business relied on. Removing it stripped out Enero's highest-margin activity and reshaped the group into a leaner, agency-focused business.

The next catalyst is close. Enero has confirmed it will release full-year results for the 12 months to 30 June 2026 (FY26) on Friday, 21 August 2026, with an investor and analyst briefing the same morning. Those numbers — the first clean full year without OBMedia — will be closely watched.

The dividend under the microscope

The headline attraction is the yield, so the arithmetic matters. Enero paid a 1.3-cent fully franked final dividend (ex-date 15 September 2025) and a 1.0-cent fully franked interim dividend (ex-date 19 March 2026), for 2.3 cents over the trailing 12 months. Against a share price of about 30 cents on 31 July 2026, that is an indicative trailing yield of roughly 7.7%; because the dividends are fully franked, the grossed-up figure is higher for eligible investors. When the price dipped nearer 27 to 28 cents in mid-2026, the same dividends implied a yield above 8%.

Context tempers the appeal. The dividend has been cut in most periods since 2022, down more than 80% from its peak — Enero paid 13 cents across FY23. Management targets a payout of 30% to 50% of adjusted earnings per share, and the interim represented about 39%, so the dividend is currently covered by underlying profit. But a policy tied to a falling earnings base offers no guarantee of the current rate, and past dividends are not a reliable guide to future payments.

Outlook, bull case and risks

Enero has not issued specific FY26 profit guidance. The bull case rests on stabilisation: the Australian agencies (BMF and Orchard) are growing strongly and expanding margins, corporate costs are down, and if Hotwire's technology-sector headwinds ease, group earnings could rebound off a low base — all underpinned by a debt-free balance sheet worth much of the current market capitalisation. On that cash-backed view, some observers argue the shares screen cheaply.

The risks are equally clear. Hotwire, still the biggest brand, is shrinking fast, and marketing budgets are cyclical and exposed to a soft global technology market. Removing OBMedia took out the group's highest-margin earnings, and free cash flow turned negative in the latest half. Liquidity in the stock is thin, amplifying price moves, and the multi-year record of dividend cuts shows how quickly income can be trimmed. None of this is investment advice, and a small-cap turnaround is far from assured.

The bottom line

Enero is a cash-rich, deeply discounted micro-cap in the middle of a reset. Its Australian agencies are performing, its balance sheet is clean and its yield is genuinely high — but its largest business is contracting and its dividend history is a story of retreat. The 21 August result, the first full year without OBMedia, should show whether the comeback narrative has substance, and whether the board holds the payout steady. For now, the story is one of a business trying to prove that a smaller, cleaner Enero can still grow. As always, past performance and past dividends do not guarantee future results.