Woodside Energy Group Ltd (ASX: WDS) shares will be in sharp focus next Tuesday, 19 August.
That's when the S&P/ASX 200 Index (ASX: XJO) energy stock is scheduled to release its half year results (H1 2025).
Investors received some insights into how that half year may look when Woodside reported its second quarter results on 23 July.
Highlights from Q2 included a 2% year-on-year increase in quarterly production to 50.1 million barrels of oil equivalent (MMboe).
Total revenue was up 8% from Q2 2024 to US$3.28 billion.
Woodside shares gained 1.5% on the day of the release.
At time of writing on Tuesday, shares are down 0.3% in intraday trade, changing hands for $26.93.
That puts shares in the ASX 200 oil and gas stock up 8.5% since reporting its quarterly results. Shares are up 5.9% over 12 months.
Woodside stock also trades on a fully franked 6.9% trailing dividend yield.
With this picture in mind, should you buy shares in the company before Woodside reports its half year results next Tuesday?
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Are Woodside shares a buy ahead of earnings results?
In a report released this morning, the team at Macquarie Group Ltd (ASX: MQG) deliberated that very question.
On the passive income front, Macquarie said that Woodside's fully franked interim dividend, expected to be around 50 US cents per share, "may again be a highlight".
The broker also said investors should keep a look out for updated commentary on Woodside's Louisiana LNG selldown(s), Bass Strait sole-risk gas opportunities and a higher restoration provision.
As for what may impact Woodside shares on the day of reporting, Macquarie said:
We estimate underlying NPAT is US$1,210m (VA consensus US$1,242m) and interim dividend US$0.50/sh (VA consensus US$0.51/sh). Following the Stonepeak deal and Chevron asset-swap, top-end payout (80%) is likely. US$400-500m hit above-the-line from increased future restoration costs (Stybarrow, Griffin, Minerva – impacts cashflow), however this is being buffered (again) by Perdaman embedded derivative accounting (US$160m purely non-cash).
Macquarie also pointed to the retrace in global oil prices since June, which it noted has not kept investors from bidding up Woodside stock since then.
According to the broker:
WDS shares now trade higher than June when Brent was US$75-80/bbl (and market was assessing Strait of Hormuz risk scenarios following Israel's strikes on Iran), despite Brent oil having fallen to the US$66-68/bbl range. Implied oil price on our model is US$62.50/bbl in risked base case, US$53.75/bbl if Trion & Louisiana LNG fully derisked.
Connecting the dots, Macquarie raised its 12-month price target for Woodside shares by 6% to $27.50 (about 2% above current levels) and maintained its neutral rating.
