Woodside Energy Group Ltd (ASX: WDS) shares are trading lower on Thursday.
In afternoon trade, the energy giant's shares are down 0.5% to $24.68. This compares unfavourably to a 1% gain by the benchmark ASX 200 index today.
Though, this underperformance is unfortunately very familiar to the company's shareholders.
For example, today's decline means that Woodside's shares are now down 24% since this time last year. Whereas the ASX 200 index is up over 12% during the same period.
While this is disappointing, could it be a buying opportunity for Aussie investors? Let's see what a $10,000 investment in its shares today could be worth by next year.
Investing $10,000 into Woodside shares
Based on its current share price of $24.68, a $10,000 investment (and a further $20.08) would allow you to pick up 406 shares in the energy producer.
While the broker community is divided on whether this would be a good idea, the team at Morgans certainly believes it would be.
Its analysts currently have an add rating and $33.00 price target on Woodside's shares.
This means that if its shares were to rise to that level, your 406 units would have a market value of $13,398. That's approximately $3,400 more than you started with.
In addition, the broker is forecasting a fully franked dividend of approximately $1.50 per share in FY 2025. This would generate dividend income of $609 and boost the total return to approximately $4,000 from your $10,000 investment. Not bad if you ask me!
Commenting on the company, Morgans said:
The tide is certainly out in terms of investor sentiment on WDS. Despite Brent oil trading in line with our long-term forecast, WDS' share price implies a near cycle-low oil price level. We do not see this as capable of being explained by WDS' growth profile (comfortably funded) or risks around non-core assets such as Browse.
While the share price performance has been disappointing, supported by a strong balance sheet and high margins, we see WDS investors as capable of being patient. Investment view: We maintain an ADD recommendation believing WDS offers attractive long-term value.
Not everyone is bullish
It is worth remembering that not everyone is bullish on Woodside and its shares.
For example, Goldman Sachs currently has a neutral rating and $25.00 price target, UBS has a neutral rating and $27.40 price target, and Citi has a sell rating and $23.00 price target.
Time will tell which broker makes the right call.
