Woolworths Group Ltd (ASX: WOW) shares are a popular option for Aussie investors.
The supermarket giant's shares feature in countless portfolios across the country.
But would they be a good option for income investors in 2025? Let's look into this and see what a $10,000 investment could turn into.
$10,000 invested into Woolworths shares
At present, the Woolworths share price is trading at $30.27. This means that with a $10,000 investment (and an extra $19.37), investors could pick up 331 shares.
The good news is that those shares could be worth considerably more by this time next year according to analysts at Goldman Sachs.
The broker recently put a buy rating and $36.10 price target on them, which implies potential upside of just over 19% for investors from current levels.
If Woolworths shares were to reach that level, it would value your 331 units at $11,949.10. That's almost $2,000 more than you started with.
This gives you a couple of options. You could cash in the capital gains and use it as a source of passive income or you could leave your investment as it is and let compounding work its magic in the years that follow.
What about dividends?
According to the note, Goldman is forecasting Woolworths to reward its shareholders with a 92 cents per share fully franked dividend in FY 2025.
If this proves accurate, it means that those 331 Woolworths shares would pull in $304.52 in passive income for the year.
It is also worth noting that the broker then expects increases to $1.10 per share in FY 2026 and $1.24 per share in FY 2027. This would mean dividend income of $364.10 and $410.44, respectively, for those years.
Why is Goldman bullish?
While the last 12 months have been a touch shaky for Woolworths, Goldman believes it is onwards and upwards from here. As a result, it sees a lot of value in its shares after 2024's weakness. It said:
With channel shift into online continuing, our recent e-Comm deep dive still suggests that WOW has the best omni-channel and digital retail capabilities amongst Australian retailers. The stock is trading at FY26e P/E of ~20x, approximately -1std below its historical average, we expect recovery in market share and cost discipline and scaling of retail media to drive recovery in AU Food EBIT margin, with trough earnings in NZ/W Living also support earnings recovery from 2H25 onwards.
All in all, this could make the retail giant one to consider buying this week.
