This report is an updated version of the report published on 11 May 2026 at 12:25 PM AEST.

Company Overview:

Aurizon Holdings Limited (ASX: AZJ) is a rail freight operator. Its segments include Network, Coal and bulk rail haulage and general freight assets. The company is a specialist in the services of rail design, engineering, construction, management, and maintenance.

Recommendation Rationale – AUD 4.020

• Surpassed Resistance: AZJ share price has surpassed the R2 level recommended on 15 August 2025; hence, the stock could face some resistance in the near term.
• Volumes Below Regulatory Assumption Network volumes of 173.5mt over ten months are tracking below the regulatory assumption of 221mt for the full year — suggesting structural or demand-side weakness in the coal network.
• Fuel Cost Timing Exposure: A subset of Bulk contracts uses quarterly (not monthly) fuel adjustment mechanisms, creating a timing mismatch. This is expected to deliver a ~AU$10 million negative EBITDA impact in FY2026 — near-term earnings drag, even if described as temporary.
• Weather and Operational Disruptions: Adverse weather hurt coal mine production in Central Queensland (March 2026 quarter) and Bulk mine production in Central Australia, indicating earnings vulnerability to external shocks.
• Contingent Guidance Assumptions FY2026 guidance explicitly depends on no further supply chain disruptions, major derailments, or prolonged wet weather — leaving guidance fragile and conditional.

Daily Price Charts

Daily Technical Chart, Data Source: REFINITV

Valuation Methodology: Price/Cash Flow Approach (FY Jun’27E) (Illustrative)

Stock might trade at a slight premium to its peers, considering the near monology infrastructure, growing bulk and freight business, and long-term contracted revenue. For conducting valuation, following peers have been considered - Lindsay Australia Ltd (ASX: LAU), Kelsian Group Ltd (ASX: KLS), and Skycity Entertainment Group Ltd (ASX: SKC).

Given the stock has surpassed its R2 level, recent rally in the share price, and risks associated, it is prudent to sell the stock at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current market price of AUD 4.020, at 11:56 AM AEST, as of 11 May 2026.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 11 May 2026. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Note 5: Dividend Yield may vary as per the stock price movement.  

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.