However, when looking from late August, the share price paints a different picture.
Below, we recap on Wesfarmers most recent result and how its shares have performed since.
What did Wesfarmers report for FY21?
Wesfarmers delivered its full-year results for the 2021 financial year to investors before market open on 27 August. The Wesfarmers share price closed the previous day at a near all-time high of $63.96.
Across the board, Wesfarmers recorded a robust performance with growth in several key metrics. This included:
- Revenue from continuing operations up 10% on the prior corresponding period to $33,941 million;
- Earnings before interest and tax (EBIT) from continuing operations jumped 18.8% to $3,776 million;
- Net profit after tax lifted 16.2% to $2,421 million; and
- Fully franked final dividend of 90 cents per share, bringing the full-year dividend to 178 cents apiece, up 17.1% year-on-year.
The strong result largely came from the company’s Bunnings and Kmart Group businesses, with Officeworks slightly behind.
Wesfarmers managing director Rob Scott commented:
Bunnings, Kmart Group and Officeworks delivered strong sales and earnings growth for the year. While customer demand remained resilient, sales growth in Bunnings, Officeworks and Catch moderated from mid-March as the businesses began to cycle elevated demand following the onset of COVID-19 in the prior year.
Pleasingly, sales growth from mid-March remained strong on a two-year basis across all of the Group’s retail businesses.
How has the Wesfarmers share price reacted?
On the day of the annual report, Wesfarmers shares fell 2.75% to finish at $62.20. The following week was not so kind to the conglomerate’s shares as they fell consecutively to register a loss of 7.27% from 30 August to 3 September.
Since then, Wesfarmers shares have had mixed trading days.
The Wesfarmers share price has lost around 10% over the last 3 weeks, while the S&P/ASX 200 Index(ASX: XJO) has fallen just 1.5%.
A number of brokers weighed in after the company released its full-year results.
Analysts at Macquarie slapped a “neutral” rating on the Wesfarmers share price, cutting its outlook by 3.3% to $61.35. On the other hand, Morgans and Credit Suisse raised their price targets by 5.2% to $59.00 and 2% to $59.91, respectively.
However, the most recent broker note came from Citi which also raised its view on Wesfarmers shares by 4.3% to $49.00. Based on the current share price, this implies a downside of around 15% on Citi’s assessment.