Monadelphous (ASX:MND) Hits All-Time High on $535m BHP and Rio Tinto Contracts: Buy or Take Profits?

Monadelphous  Hits Record High on $535m Contracts

Monadelphous (ASX: MND) surged to an all-time high of A$28.89 this week after announcing another A$110 million in new contracts, capping off an extraordinary run that has seen the engineering services company secure approximately A$535 million in work over recent weeks. The stock has more than doubled over the past 12 months, climbing from lows around A$13.36 to a market capitalisation of approximately A$2.7 billion. For investors watching the resources services sector, the key question is whether this momentum can continue or whether the stock is now priced for perfection.

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Why BHP and Rio Tinto Keep Coming Back to Monadelphous

What stands out about Monadelphous is the quality of its client relationships. The company has built partnerships with Australia’s largest miners for more than 50 years, and that trust continues to pay dividends.

The most significant recent win is the A$175 million BHP Car Dumper Project at Finucane Island in Port Hedland, involving complex structural, mechanical, piping, and electrical work. This follows the A$250 million Rio Tinto Brockman Syncline 1 contract announced in December 2025, which covers the construction of a new primary crusher and overland conveyor, with completion expected in 2027.

These aren’t one-off contracts. They reflect Monadelphous’s ability to deliver on large-scale, technically demanding projects, something that keeps major miners returning despite competitive tendering processes. For investors, this track record is a meaningful competitive moat that smaller rivals struggle to replicate.
The company has also diversified beyond traditional mining services. Through its Zenviron joint venture, Monadelphous is increasingly active in renewable energy and battery storage projects, reducing its exposure to mining cycle volatility.

Monadelphous Builds Revenue Visibility Through 2027

The recent contract wins provide strong earnings visibility over the medium term, a factor that reduces uncertainty for investors.
The A$110 million in contracts announced this week span resources, energy, and renewables across Western Australia, Victoria, Northern Territory, and Papua New Guinea. Key wins include a four-year maintenance contract with BW Offshore at the BW Opal FPSO facility near Darwin, modification works at Rio Tinto’s Hope Downs 2 project, and a battery energy storage system project in Victoria through the Zenviron joint venture.

Combined with the BHP and Rio Tinto awards, Monadelphous now has a substantial order book supporting revenue through 2027. For a services business that typically operates on shorter contract cycles, this visibility is unusual and valuable. It suggests management has successfully positioned the company to benefit from the current mining capital expenditure upcycle while simultaneously building exposure to the growing renewables sector.

The Investor’s Takeaway

The investment case for Monadelphous hinges on whether the strong fundamentals justify the stretched valuation. On the bull side, the order book strength is undeniable. Major miners are investing heavily in sustaining capital works, and Monadelphous is clearly winning its share. The renewables diversification adds a growth avenue that could support earnings beyond the current mining cycle.

However, the stock has already more than doubled in 12 months, and Goldman Sachs’ price target sits at A$28.75, suggesting limited near-term upside from current levels. With the shares trading at record highs, much of the good news appears priced in.

For existing holders, the strong order book supports maintaining positions, though trimming after such a significant run would be a reasonable risk management approach. For new investors, the fundamentals are attractive, but waiting for a pullback may offer better risk-reward. Monadelphous is a quality business, but at current prices, the margin of safety has narrowed considerably.