The Coles Group Ltd (ASX: COL) share price has had a very good 2025 to date, rising by 20%, as the chart below shows.
Coles is one of the leading supermarket businesses in Australia, alongside Woolworths Group Ltd (ASX: WOW). Aldi and IGA are some other significant players in the sector.
While Coles is best known for being a supermarket business, it owns or is invested in other businesses such as Coles Liquor, First Choice Liquor Market, Liquorland, Vintage Cellars, Flybuys and Coles Financial Services.
Let's take a look at how popular the supermarket is and why the Coles share price is attractive.
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Multiple buy ratings
According to CommSec, there are currently 11 analysts who rate the supermarket business as a buy, which is a very notable level of optimism among experts.
CMC Markets suggests that the average analyst price target on the business is $24.03, which is where the analyst thinks the share price could be in 12 months from the time of the investment call. Therefore, the analysts are collectively implying they believe the Coles share price could rise by more than 5% over the next year, plus dividends.
Impressive performance
Coles is currently doing a very good job of growing sales faster than Woolworths, which is a key sign of which business is doing better at attracting customers.
Coles has worked hard at providing a line-up of own-brand products that customers may want, as well as improving its efficiencies across the business.
In the first few weeks of FY26, Coles reported that supermarket sales revenue increased by another 4.9% (or 7% excluding tobacco). This sales growth was supported by "continued strength in volumes" as it continues to invest in "customer value and experience".
Its e-commerce sales are also benefiting from the investments it's making in its digital offer.
Over the last few years, Coles has invested heavily in its supply chain with both the huge automated distribution centres (ADCs) as well as customer fulfillment centres (CFCs). In FY26, its ADC program will deliver its first full year of annualised benefits. It's on track to deliver improved earnings from the CFC facilities as the volumes continue increasing.
FY26 also won't see any implementation, dual running and transition costs related to its ADCs or CFCs.
Overall, the future looks bright for future earnings growth, including an additional net 10 new supermarkets in FY26.
I expect earnings and dividend growth from the business in FY26, which are useful tailwinds for the Coles share price.
