Bapcor’s revised 2026 guidance has prompted concerns from Morgans analyst Jared Gelsomino, who highlighted a challenging first half and potential strain on the company’s balance sheet. Bapcor is a leading provider of vehicle parts, accessories, equipment, service and solutions. The company operates across the automotive aftermarket, serving a diverse range of customers.
The revised guidance included a substantial cut to first-half underlying net profit, down approximately 60 per cent to between $5 million and $8 million. The full-year 2026 underlying net profit forecast was also reduced by 17 per cent, landing between $44 million and $49 million. While Bapcor anticipates a significantly stronger second half, projecting a $40 million net profit after tax (NPAT), Morgans suggests that investor confidence in achieving this skewed outcome is likely to be low.
Gelsomino pointed to trading softness experienced in October and November, particularly within the Trade segment. This segment’s efforts to regain market share through pricing strategies have resulted in short-term margin compression. In contrast, the Retail segment performed well, and the Networks and New Zealand segments remained in line with expectations.
Adding to concerns is the pressure on Bapcor’s balance sheet. The company is reportedly seeking to increase its FY26 leverage covenant, given the limited prospects for deleveraging during the weak first half. Morgans summarised the investment case as “incredibly challenging amid anaemic top-line performance, margin compression, and balance sheet risk.”
