The Woodside Energy Group Ltd (ASX: WDS) share price is up 1.8% in early afternoon trade today after falling 2.6% on Friday.
Today's rebound comes on the back of higher crude oil prices. Brent crude gained 1.9% overnight amid news that China is rolling back its economy, hampering COVID zero policies.
Brent is currently trading for US$87.23 per barrel. That's a 5.1% increase since last Tuesday.
However, oil and gas prices have remained sharply down over the past month. And the Woodside share price is also down 7% since this time last month.
Which brings us to…
Is the Woodside share price cheap following its recent dip?
Whether the Woodside share price represents good value at current levels depends on who you ask.
A number of analysts were disappointed after the S&P/ASX 200 Index (ASX: XJO) oil and gas stock released its FY23 guidance on 29 November.
In its first full year of production since its petroleum transaction with BHP Group Ltd (ASX: BHP), Woodside forecast production of 180 – 190 million barrels of oil equivalent (MMboe).
That figure came in lower than consensus expectations.
UBS counts amongst those with a bearish near-term outlook for the oil and gas giant, reducing its target for the Woodside share price to $34 from $34.40 That's some 5% below the current price of $36.23 per share.
According to UBS (courtesy of The Australian Financial Review):
Despite a miss to 2023 production & capex, valuation still appears very full at current prices with WDS implying $78/bbl oil prices vs peers at low $60s/bbl.
Barrenjoey has also downgraded Woodside shares to underweight, dropping its price target from $35.80 per share to $35.20. Barrenjoey's analysts had forecast FY23 production of 203MMboe.
According to Barrenjoey analyst Dale Koenders (quoted by The Australian):
We think the cracks from execution risks are starting to show for Woodside given the Sangomar start-up has been delayed from 2023 to 2H23 in August and as MODEC is shifting Flotation and Production Storage Offloading Unit construction / commissioning from China to Singapore to mitigate COVID-related labour constraints.
Sounding off for the Woodside bulls
Coming in with a positive view on the Woodside share price after the past month's dip is Evans & Partners.
Its analysts, Adam Martin and Branko Skocic, kicked off Woodside Energy's research coverage with a positive rating, valuing the company at $40 per share.
With new energy projects still lacking investment, they said the recent dip in Woodside "could provide an attractive entry point".
According to the analysts (courtesy of The Australian):
For LNG markets in particular, there appears no easy solution to bring on new global supply, with lead times five years plus. This is coupled with demand growth across Europe – replacing Russian pipeline gas – and further growth out of Asia. We believe LNG will remain critical in the initial stages of the Energy Transition.
The Woodside share price is up 60% in 2022.
