Highlights

  • Codan’s first-half FY26 revenue projected at AUD 394 million, up 29% over pcp.
  • Metal detection revenue grew ~46%, driven by African gold detector demand.
  • Communications segment achieved AUD 222 million in revenue, up ~19% year-on-year.

Codan Limited (ASX:CDA) began 2026 with a notable surge, closing at AUD 36.55 on 14 January, up 28.56% from the start of the year and showing growth of over 134.29% in a 12-month comparison.

The recent price rally might follow the company’s preliminary first-half FY26 trading update released on 9 January, which highlighted revenue growth across its metal detection and communications businesses. Investors are assessing whether this momentum can be maintained, especially as the company prepares to release full first-half results on 19 February.

Bell Potter Securities (institutional) has issued a hold rating with a target price of AUD 36.70, while Moelis Australia Securities has a buy rating with a target of AUD 42.31, indicating a mix of caution and optimism in the market.

First-Half FY26 Results Signal Significant Growth

According to Codan’s ASX release, the company expects group revenue for the first half of FY26 to reach approximately AUD 394 million, representing a 29% increase over the prior corresponding period (pcp). Underlying net profit after tax is projected at no less than AUD 70 million, up 52% versus pcp. The metals detection segment led growth with revenue of AUD 168 million, up ~46% on the back of increased gold detector sales in Africa and recreational sales in other international markets. Meanwhile, the communications division generated AUD 222 million, up ~19% and maintaining the upper range of its previously guided growth target of 15–20%.

Momentum from FY25 Supports Early Gains

The current surge builds on a FY25 performance, when Codan reported group revenue of AUD 674.2 million, up 22% versus pcp, and net profit after tax of AUD 103.5 million, up 27%. Both the communications and metal detection businesses contributed to revenue and segment profit growth, with communications revenue rising 26% to AUD 413.5 million and metal detection revenue increasing 16% to AUD 254.8 million. The company also reduced net debt to AUD 78.3 million from AUD 124.1 million in December 2024, positioning it with greater financial flexibility.

Outlook: Growth Drivers and Analyst Considerations

Looking ahead to FY26, Codan expects ongoing growth in its communications segment, supported by defense spending increases, the unmanned systems market, and the full-year contribution from Kägwerks. The metal detection business is set to release four new products in 2026 across recreational, gold, and countermine ranges, benefiting from favorable market conditions in West Africa.

As the company prepares to report full FY26 first-half results, investors and analysts will be watching closely to determine whether the stock’s early 2026 gains can be extended further.