Down 7.3%: Inside Woolworths stock's horror September

Things went from bad to worse for Woolies over September.

Key points
  • Woolworths experienced a 7.3% drop in share price during September, contributing to a total decline of 13.14% in 2025 so far and a fall of over 21% from its 52-week high.
  • The stock's decline is largely attributed to the unfavourable full-year earnings report from August, which included a 12.6% drop in EBIT and a 17.1% fall in net profits, leading to a 21.1% dividend cut.
  • Opinions on future prospects are mixed; some analysts see the current price drop as a buying opportunity, while others advise caution due to the lack of immediate positive catalysts.

The month just gone wasn't a good one for ASX shares on the whole. September saw the S&P/ASX 200 Index (ASX: XJO) retreat a not-insignificant 1.4%, descending from 8,973.1 points to the 8,848.8 points it closed at yesterday. But that's nothing compared to what Woolworths Group Ltd (ASX: WOW) stock endured.

The ASX 200 consumer staples stock just had one of its worst months in years, if we don't include its even more woeful August. At the beginning of September, the Woolworths share price was sitting at $28.80. Yesterday, those same shares closed out the month at just $26.70. That means the Woolworths stock price tanked by 7.3% over the month of September.

Last month's move, plus the further 0.8% drop Woolworths shares have endured so far this Wednesday, put the company down a depressing 13.14% in 2025 to date. The company is also down more than 21% from the 52-week high of $33.76 that we saw in mid-August.

So why did Woolworths stock continue to plummet over September?

A hand holds up a rotten apple in an orchard.

Image source: Getty Images

Why did Woolworths stock tank 7.3% in September?

Well, there wasn't much in the way of significant news out of the company over the month just gone. As such, we can probably conclude that investors continued to lose faith in Woolworths shares in September following the disastrous full-year earnings report that we saw back in late August.

As we covered at the time, these earnings were hard for investors to look through. Woolworths reported a 12.6% drop in earnings before interest and tax (EBIT) for the 12 months to 30 June to $2.75 billion. Net profits after tax were even worse, cratering 17.1% to $1.39 billion.

As a result, Woolworths cut its final dividend for 2025 by 21.1% to 45 cents per share.

Given those numbers, as well as the relatively lofty valuations the company was trading at prior to this report being released, it's arguably no surprise to see the company have such a tough month last month.

However, perhaps things could look up from here. As we've covered recently, there are a few ASX brokers who think the big falls that we've seen for Woolworths stock could make it a compelling buying opportunity. Last month, my Fool colleague looked at the views of Red Leaf Securities. This broker stated that "the [Woolworths] share price offers an attractive entry point into a defensive staple with long term growth levers and reliable shareholder returns".

Saying that, this view is not universally shared. Other brokers, Bell Potter, for example, have warned investors to stay away, at least for now. That's given the alleged lack of any positive catalysts for the company in the foreseeable future.

Let's see how this blue-chip stock goes this October.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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