When small ASX companies start stacking genuine business wins, the market can move fast.
With limited liquidity and smaller revenue bases, it doesn't take much for a well-executed strategy to spark a powerful re-rating.
That's exactly what's happened to Stealth Group Holdings Ltd (ASX:SGI).
Over the past 12 months, the Perth-based distribution company has quietly climbed over 275%, turning from a microcap into a serious small-cap contender with one of the strongest growth stories on the market.
What does Stealth Group do?
Stealth Group is a diversified Australian distribution company delivering products and solutions to businesses, trade professionals, and retail consumers across multiple sectors.
Through its two divisions — Industrial & Hardware Distribution and Consumer Products — Stealth operates a multi-channel model that reaches customers across both business and retail markets.
Its industrial arm supplies maintenance, repair and operations (MRO) products such as PPE, tools, fasteners, and consumables through a network of more than 40 branches and stores and 1,100 suppliers. It services more than 40,000 trade and business customers across mining, construction, and government.
Meanwhile, the consumer division distributes and designs tech accessories and everyday products for major retailers like JB Hi-Fi Ltd (ASX:JBH), Coles Group Ltd (ASX:COL), 7-Eleven, Officeworks, and The Good Guys, reaching 3,500 retail stores nationally.
It's a business model that blends wholesale, retail, and e-commerce channels and that flexibility has become one of Stealth's biggest advantages.
What has happened in the past 12 months?
FY25 was a breakout year. Stealth reported record sales of $145.1 million, up 27.6%, while operating earnings (EBITDA) jumped 62% to $9.9 million and net profit more than doubled to $3.1 million.
Margins improved thanks to disciplined cost control and operating leverage, while net debt dropped 37% to $6.8 million, the lowest in five years.
The company also expanded its exclusive and private-label brands, including CAT, WESCO, Harden Tools, Belkin, CASETiFY, Ember, and RIVO Safety, and launched two new ventures: Tool Hire and United Supply Co, an online retail platform.
Then, on 10 November 2025, Stealth announced a transformational acquisition: Hardware & Building Traders, Australia's largest privately owned hardware buying group.
The $22 million all-cash deal adds 1,165 independent stores, $700 million in annual purchases, and a vast network of 490 suppliers. The transaction upgrades Stealth's FY28 sales target from $300 million to more than $500 million, cementing its position as Australia's leading independent alternative to Bunnings.
A micro cap no more
Stealth's story is a reminder of how quickly market perception can change when fundamentals align.
It has turned from a little-known distributor into a scaled national operator with a clear path to higher margins and stronger cash flows.
While the share price has already run hard, Stealth's trajectory shows what's possible when a small business finds its formula and executes relentlessly.
It might not be a buy today, but it's certainly one to watch as this ASX small cap continues its climb toward the big leagues.
The post The stealth success story behind this ASX small cap's 275% share price rally appeared first on The Motley Fool Australia.
Motley Fool contributor Leigh Gant 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 no position in any of the stocks mentioned. 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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