Image source: Getty Images
Woolworths vs Coles shares: Which supermarket player deserves a place in your portfolio?
Both Woolworths Group Ltd (ASX: WOW) and Coles Group Ltd (ASX: COL) have become household names for Aussies when it comes to grocery shopping. If you're considering these supermarket heavyweights for the dividend income they're known for, you might be weighing up Woolworths vs Coles shares. Let's unpack how these rivals stack up on yield, value, and recent performance.
The case for Woolworths Group
Woolworths Group stands as one of Australia's largest retail companies, with a strong presence in the supermarket sector across Australia and New Zealand. The company also owns the Big W discount department store chain and several supermarket brands in New Zealand. Woolworths is known for its defensive qualities, as consumers continue to spend on essentials like food and toiletries even during economic downturns.
Looking at the numbers, Woolworths commands a massive market cap of $47.34 billion, making it the larger of the two by some margin. Its shares sport a price-to-earnings (P/E) ratio of 41.62 and an earnings per share (EPS) of $0.925. For income seekers, Woolworths is fully franked and has a current dividend yield of 2.52%. The group has shown robust YTD (year-to-date) returns of 34.34%.
On dividends, Woolworths has a reliable habit, paying fully franked dividends for decades. Its latest final dividend was $0.52 per share, paid in September 2026, and there was also a $0.45 interim earlier in the year.
The case for Coles Group
Coles Group is another major force in Aussie retail, providing groceries, household goods, liquor, and more — in-store and online. The business was previously part of Wesfarmers, but became its own ASX-listed company again in 2018. Coles operates over 900 supermarkets and also has Coles Express and Coles Liquor, though it sold off its fuel and convenience division to focus on core retailing.
Coles comes in with a $31.48 billion market cap, making it smaller than Woolworths but still a market leader by any measure. It trades at a lower P/E of 28.61 and offers a dividend yield of 3.36%, notably higher than Woolworths. Like its rival, Coles dividends are fully franked, and its current EPS is $0.812. The year-to-date return stands at 11.99%.
Dividend consistency is strong, with regular half-yearly payments. The latest final dividend was $0.37 per share (paid September 2026), with a $0.41 interim earlier in the year, all fully franked.
Valuation comparison
Here's how some key stats line up side by side:
| Metric | Woolworths | Coles |
|---|---|---|
| Market Cap | $47.34b | $31.48b |
| P/E Ratio | 41.62 | 28.61 |
| Dividend Yield | 2.52% | 3.36% |
| Earnings per Share | $0.925 | $0.812 |
| YTD Return | 34.34% | 11.99% |
| Franking | 100% | 100% |
Woolworths is the much larger company, with stronger recent share price appreciation, but Coles stands out for its lower valuation and bigger dividend yield.
Recent share price performance
Please note: these prices reflect the close on 14 September 2026, not live data.
– Woolworths closed at $38.75, having rallied strongly throughout 2026. Its YTD return is an impressive 34.34%.
– Coles closed at $23.44, with a 2026 YTD return of 11.99%.
Over recent weeks, both shares have experienced typical market ups and downs, but Woolworths has shown more significant price momentum than Coles.
Which is the better buy?
If I had to pick between Woolworths and Coles right now, my nod goes to Coles. Here's why: the dividend yield is meaningfully higher at 3.36% compared to Woolworths's 2.52%, so if I'm chasing income, Coles is immediately more appealing — and both offer fully franked dividends, making income even sweeter for Aussie shareholders.
Coles also trades on a much lower P/E, hinting that Woolworths's current valuation is pretty stretched, especially after that bumper 34% YTD gain. While Woolworths's share price run is impressive, it leaves less room for error and less compelling value. Coles looks relatively steady and offers more bang for buck on the dividend front, which matters most to yield-focused investors.
Woolworths still boasts market leadership and a reputation for resilience, but today, I reckon Coles is the supermarket share with the greater value and income edge.
