Woolworths Group Ltd (ASX: WOW) shares were in the spotlight on Wednesday.
Unfortunately, this was for all the wrong reasons, with the supermarket giant's shares ending yesterday's session 15% lower at $28.51.
This leaves them trading just a fraction away from a multi-year low of $27.60.
Is this your signal to pick up shares? Let's see what one top broker is saying.
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What is the broker saying?
Bell Potter has been running the rule over the results and although they were disappointing, they were largely in line with expectations. It said:
Revenue of $69,077m was up +4% YOY (vs. BPe $69,179m). EBITDA of $5,707m was down -4% YOY (vs. BPe of $5,775m). Underlying NPAT of $1,385m was down -17% YOY (vs. BPe of $1,381m). FY25 results wore the impact of 1H25 industrial action in the Australian Food business ($95m in EBIT) and the impact of supply chain commissioning and dual running costs ($73m EBIT). Significant items of $569m included a $346m impairment of Big W.
The broker also highlights that Woolworths has started FY 2026 slower than rival Coles Group Ltd (ASX: COL). It adds:
Key outlook comments included: (1) Australian Food first 8wks trading showing +2.1% YOY top line growth (vs. COL at +4.9%) and FY26e EBIT is expected to exhibit mid-to-high single digit YOY growth; (2) NZ Food first 8wks trading showing +2.6% YOY and is expected to exhibit a further improvement in FY26e EBIT; (3) Big W first 8wks trading is broadly flat and FY26e EBIT is projected to be positive (vs. $36m loss in FY25); and (4) WOW is on track to deliver $400m target in corporate savings by end CY25e.
Should you buy Woolworths shares?
Unfortunately, Bell Potter hasn't seen anything in Woolworths' results to change its view.
According to the note, the broker has retained its hold rating on its shares with a trimmed price target of $29.80 (from $31.90).
Based on its current share price, this implies modest upside of 4.5% for investors over the next 12 months.
In addition, a 3.2% dividend yield is expected in FY 2026, boosting the total potential return to just under 8%.
Commenting on its hold recommendation, the broker said:
Our Hold rating is unchanged. 2H25-1Q26 trends in the core grocery business were weaker than expected. If management can execute a turnaround, then the multiple versus growth equation is attractive relative to peers, however, we are cognisant our EPS forecasts have been downgraded 10-14% over the past six months.
