The Baggy Greens were widely written off ahead of both the summer and winter series early in the summer, with on and off-field problems dominating their preparations.
However, Stewart feels that Australia have gained their confidence back and can be a major threat to England over the course of the series.
"In naming their squad more than a week before the first Ashes Test, Australia are showing a confidence and stability that were conspicuous by their absence during their preparations for the series in England last summer," Stewart told BBC Sport.
"Back then, Australia were in total disarray. The David Warner bar-room brawl, the last-minute change of coach and the left-field selection of Ashton Agar for the first Test all spoke of a total lack of strategy and togetherness. They were a laughing stock and by the time they pulled themselves together in the second half of the series, The Ashes were already gone.
"This time round, there is a calm and clarity of thought about Michael Clarke's team which suggests they will be a much tougher proposition on home soil. In keeping faith with 10 of the side that played in the final Test at The Oval, and adding two of their in-form one-day players in George Bailey and Mitchell Johnson, Australia are showing that they are comfortable with their personnel and want to spend the next week fine-tuning their plans for that all-important first Test in Brisbane."
The first Test in Brisbane gets underway on Thursday next week.