Buy, hold, sell: James Hardie, Reece, and TechnologyOne shares

There are a lot of ASX shares to choose from on the Australian share market.

To narrow things down, let’s look at what Morgans is saying about a few popular options following recent updates. Here’s what it is recommending:

James Hardie Industries plc (ASX: JHX)

Morgans was pleased with this building products company’s recent quarterly update, noting that its performance and outlook were more positive than expected.

As a result, the broker has upgraded its shares to a buy rating with a $35.50 price target. It said:

Whilst the headline 2QFY26 result was largely released in early Oct-25, the details and outlook were incrementally more positive than previously anticipated. Upgraded guidance reflects a c.6% organic decline (vs pcp), as a challenging environment sees volume declines exceed price increases.

However, this is better than feared and may prove to be a bottoming in the cycle as demand stabilises. JHX is trading on c.17.1x FY26F as the business navigates its acquisition missteps, earnings downgrades and a challenging consumer environment in North America (NA). However, at EPS of c.U$1.04/sh in FY26 we see upside from both earnings and an undemanding PER (ave PER. 20x). It is on this basis we upgrade to a BUY recommendation and $35.50/sh target price.

Reece Ltd (ASX: REH)

This plumbing parts company also delivered a quarterly update that was better than expected.

However, Morgans highlights that the worst is not necessarily over for Reece, with its margins and earnings under pressure from higher costs.

In light of this, it has only upgraded its shares to a hold rating with an $11.25 price target. It said:

REH provided a trading update at its AGM. 1Q26 sales were stronger than anticipated, supported by contributions from an expanded branch network across both ANZ and the US. However, earnings and margins remain under pressure due to higher costs. Management expects soft market conditions to persist in both ANZ and the US. We increase FY26-28F sales by 7%, while EBIT remains largely unchanged (+1%). Our estimates also incorporate the recent off-market buyback. Our target price rises to $11.25 (from $11.10).

With a 12-month forecast TSR of 5%, we upgrade our rating to HOLD (from TRIM). While we continue to view REH as a fundamentally strong business with a good culture and a long track record of growth, the operating environment remains challenging, particularly in the US where competitive pressures persist. Trading on 24.2x FY26F PE with a 1.6% yield, we see the stock as fully valued and prefer to wait for signs of market improvement before reassessing our view.

TechnologyOne Ltd (ASX: TNE)

Finally, enterprise software provider TechnologyOne released a full year result that was in line with Morgans’ expectations.

And while its annualised recurring revenue (ARR) may have been a touch softer than expected, the broker feels the negative share price reaction has been overdone. As a result, it has upgraded its shares to an accumulate rating with a $34.50 price target. It said:

TNE’s FY25 result was largely in line with our expectations with the group delivering, PBT growth of +19% to $181.5m ahead of its 13-17% guidance range, and in line with consensus. The negative share price reaction appears to have been driven by softer than expected ARR/NRR print, which saw a 2% miss to ARR growth expectations vs consensus, despite this, the group continues to deliver, with ARR of $554.6m (+18% YoY), which along with its NRR growth of 115% continues to see TNE Ontrack to achieve its long-term ARR growth aspirations.

We modestly pare our EPS forecasts by 1-3% in FY26-28F. and move to an ACCUMULATE rating, with our target price $34.50 now reflecting a TSR of +19% following TNE’s post result share price movement.

The post Buy, hold, sell: James Hardie, Reece, and TechnologyOne shares appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Technology One. The Motley Fool Australia has recommended Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.