Guess which ASX All Ords share is up 68% but still dirt cheap

There have been some big returns on the ASX All Ordinaries index this year.

Among those is the ASX All Ords share in this article, which is up an impressive 68% since the start of the year.

But if you thought that this share was close to peaking, you would be wrong according to analysts at Bell Potter.

In fact, the broker believes this stock is dirt cheap and destined to deliver huge returns over the next 12 months.

Which ASX All Ords share is dirt cheap?

The share in question is Southern Cross Electrical Engineer Ltd (ASX: SXE).

It is a leading provider of electrical, instrumentation, communications, security and maintenance services to a diverse mix of customers. This includes a large number of blue chip customers such as Woolworths Group (ASX: WOW), Coles Group Ltd (ASX: COL), BHP Group (ASX: BHP), Rio Tinto Ltd (ASX: RIO), Multiplex, and CPB Contractors.

According to the note, the broker has been impressed with the company's performance this year and believes it is destined to deliver strong revenue growth in the first half. It said:

Excluding the ~$50m Collie BESS Project Switchyard construction package awarded on 5 July 2024, SXE has announced >$225m of new contract awards in FY25-to-date, including purchase orders at Trivantage Manufacturing. These orders compare with >$140m of contracts awarded in the PcP and ~$470m in FY24 (including $210m of work packages for the Collie BESS project and switchyard). We expect SXE to deliver a 1H FY25 orderbook that is consistent with the record $720m reported at FY24, accounting for increased project delivery in 1H FY25, with revenue to lift 23% YoY to $314m.

In light of this, the broker has reiterated its buy rating and $2.25 price target on the ASX All Ords share this morning.

Based on its current share price of $1.43, this implies potential upside of 57% for investors over the next 12 months. In addition, a 4.9% dividend yield is expected in FY 2025. This boosts the total potential return to approximately 62%.

Commenting on its bullish view of the stock, Bell Potter said:

SXE brings key small cap exposure to several emerging and structural themes, including the proliferation of data centre construction across Australia, decarbonisation of the Australian economy, electrification of industries and the build-out of large-scale critical infrastructure. SXE's blue-chip clientele and high proportion of recurring work (33% of FY24 Group revenue) provides some stability to operations and financials and reduced counterparty risk.

The post Guess which ASX All Ords share is up 68% but still dirt cheap appeared first on The Motley Fool Australia.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Coles Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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