Woodside Energy Group Ltd (ASX: WDS) shares have been out of form this year.
Since the start of 2025, the energy giant's shares have fallen 7.5%.
As a comparison, the ASX 200 index is up almost 9.5% over the same period.
Does this make Woodside shares good value now? Let's see what analysts at Macquarie Group Ltd (ASX: MQG) are saying about the company.
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What is Macquarie saying?
Macquarie notes that its Macro Strategy team has lowered its oil and LNG price forecasts and is expecting prices below consensus in the near term. It said:
We lower Brent oil, US gas, spot LNG (JKM) forecasts over the next five quarters (below consensus), in coordination with our Macro Strategy team. Lowering spot LNG prices ~US$2/MMBtu over next three quarters; winter balances look more comfortable. 2027/28E still look very tough.
In light of this, the broker is taking an underweight position upstream oil & gas. Though, it remains bullish on Santos Ltd (ASX: STO) shares for valuation reasons. It said:
We feel an underweight position in upstream oil & gas is currently justified (vs ASX200) given our expectation of declining oil and LNG prices over the next one to two years. STO is our preferred exposure.
What about Woodside shares?
According to the note, the broker has retained its neutral rating on Woodside's shares with a trimmed price target of $24.00.
Based on its current share price of $23.02, this implies modest potential upside of 4.3% for investors over the next 12 months.
Though, its expectation for a dividend yield of approximately 5% over the period boosts the total potential return to over 9%.
Commenting on Woodside, the broker said:
Woodside Energy (Neutral): Implied oil px US$57/bbl. WDS remains on an ambitious growth path, with EBIT pivoting outside of Australia to international in the 2030s (USA, Mexico, Senegal). Gearing was a surprise to us at 1H25 results (high end of guardrails, with sizeable committed growth capex still ahead), highlighting the importance of the Stonepeak funding deal for Louisiana LNG and the pending sell-downs of equity in the project (which would come with back capex).
Lower commodity price estimates (oil, spot LNG, US gas) have driven EPS -6% in CY25E and -25% in CY26E. Our 12-month target price is -4% to $24.00, which reflects (i) lower commodity prices partly offset by (ii) increased Louisiana inclusion (70%, was 50%) to reflect recent commercial progress.
