Criterion: Look beyond this year’s AGM theatrics to the underlying earnings messages 

• AGMs can be entertaining – or plain excruciating – but look out for surprise trading updates  
• With valuations at heady levels, many stocks are vulnerable to less than chirpy outlook statements
• Some companies face an investor backlash because of underperformance or corporate governance issues

Like electioneering politicians on street walks, corporate annual general meetings (AGMs) are best known for their spontaneous moments, rather than anodLne renditions from the autocue.

A case in point is the real-life Commonwealth Bank (ASX:CBA) worker accosting the bank’s real-life CEO about losing their job to AI.

Otherwise, AGMs are usually a missed once-in-a-year opportunity for shareholders to eyeball their board.

They either don’t ask questions, or ones that pertain to their invariably negative experiences as a customer.

The advent of online and hybrid meetings has democratised AGM participation. But it also enables management to weed out curly questions.

Few folk go to physical AGMs just for the scones and pinwheel sandwiches these days.

But trading updates remain a good reason to tune in.

No margin for error with valuations

This year’s AGM fiesta is unfolding amid a sustained bull run that sees the market trading at a multiple of 20  times. This compares to the historical average of around 14 times.

These elevated valuations can only be maintained if companies show decent earnings growth. This is why the trading outlook statements are even more important than usual.

Across the market, Macquarie Equities forecasts current year earnings per share (EPS) growth of 2.8%, abating to 0.7% in the 2026-27 year.

The firm’s outlook for domestic industrials is rosier: 4.5% EPS growth this year and an 8.5% spurt next year.

Broker Wilsons has trimmed its Australian equity position marginally, “due to likely headwinds from stretched valuations, alongside less scope for RBA [interest rate] easing to stimulate earnings growth over the coming year.”

Wilsons notes local equities have lagged offshore shares in recent months, partly due to our relatively low exposure to tech stocks.

But “domestic valuations still appear stretched, with many big caps looking quite expensive relative to their moderate growth prospects”.

Wilsons expects only “tepid” growth for the banks  and large cap miners.

… or pleasant surprises in store?

Most boards offer a view on year-to-date trading at AGMs.

Given four months or more have elapsed since June 30 cut-off, these updates can move share prices. For better or for worse.

Macquarie Equities suggests that because corporate Australia gave conservative guidance at August results time, we can expect some pleasant surprises given domestic growth has improved since then.

“Small caps in particular could deliver more positive AGM surprises, as they delivered more [earnings] beats in August while often being more leveraged to improving domestic growth.”

So far there haven’t been too many shocker trading updates. But ahead of Treasury Wine Estates’ (ASX:TWE) October 16 AGM, the company confessed it was unable to stick to its full-year guidance, owing to the “uncertain outlook” for its Penfolds and US divisions.

That one went down like a corked 1990 St Henri, sending the shares down 14%.

AGMs worth the price of admission

Investors will closely watch CSL’s (ASX:CSL) meet next Tuesday for an update on its multi-pronged transformation manifesto.

Any clarity on how the Trump administration’s tariffs and drug pricing policies affect the blood plasma giant would be nice … but don’t hold your breath.

Book a (virtual) seat for Wesfarmers’ (ASX:WES) Perth meet on October 30. The owner of Kmart Bunnings and Officeworks, the conglomerate should offer wise words on the consumer mindset.

JB HiFi (ASX:JBH) in August reported “positive momentum” in July after better-than-expected full year sales. The retailer is tipped to confirm that trend at its October 30 powwow.

Webcast from Dublin HQ, James Hardie’s (ASX:JHX) shindig next Thursday promises to be a livelier affair than a night of craic at the city’s famed Temple Bar.

Proxy advisor Institutional Shareholder Services is gunning to remove chair Anne Lloyd and four other directors. This follows the company’s unpopular $14 billion purchase of US decking maker Azek.

In the case of ‘issues rich’ Super Retail Group (ASX:SUL), chair Judith Swales faces a similar motion backed by proxy wrangler Ownership Matters.

Stocks likely to issue downbeat trading updates include Domino’s Pizza Enterprises (ASX:DMP) at its November  12 AGM, Monash IVF Group (ASX:MVF) (Nov 20) and WiseTech Global (ASX:WTC) (Nov 21).

Global packager Amcor (ASX:AMC) (Nov 7) should give a workmanlike perspective on consumer demand for basic everyday goods.

If all of that doesn’t float your boat, tune into Propel Funeral Partners (ASX:PFP) update on whether last year’s pleasing uptick in mortalities has endured.

Pleasing for some, of course …

This report does not constitute financial product advice. You should consider obtaining financial advice before making any financial decisions.