Insights

Own Woolworths (ASX:WOW) shares? Here’s what to look for during reporting season

Here’s what you need to know about the Woolworths FY 2021 result…
The post Own Woolworths (ASX:WOW) shares? Here’s what to look for during reporting season appeared first on The Motley Fool Australia. –

Woolworths Group Ltd (ASX: WOW) shares will be on watch later this month when it hands in its first results since the Endeavour Group Ltd (ASX: EDV) demerger.

Ahead of the results release, I thought I would look to see what the market is expecting from the retail giant.

What is the market expecting from Woolworths in FY 2021?

Due to the aforementioned demerger of its drinks and hotels business, Woolworths’ results will be a little messier than normal.

According to a note out of Goldman Sachs, its analysts expect Woolworths to report sales of $55,415 million and earnings before interest and tax (EBIT) from continuing operations of $2,796 million for the 12 months.

The latter comprises:

Australian Food EBIT growth of 7.4% to $2,398 million
NZ Food EBIT growth of 18.1% to $672 million.
BigW EBIT growth of 315% to $162 million.
A 28.5% reduction in corporate expenses to $108 million.

On the bottom line, Goldman expects this to lead to continuing net profit after tax of $1,474 million and reported net profit after tax of $2,158 million. The latter includes contributions from discontinued operations.

Lastly, a fully franked final dividend of 33 cents per share is expected to be declared. This will bring the Woolworths dividend to 86 cents per share for FY 2021.

What else could impact the Woolworths share price?

The Woolworths share price could be given a boost from commentary on management’s capital return plans.

During the Endeavour demerger, Woolworths advised that it intends to return between $1.6 billion and $2 billion shareholders via a special dividend.

And given its balance sheet strength, there has even been speculation of a share buyback in the near future too.

Are its shares in the buy zone?

Goldman Sachs isn’t in a rush to invest and continues to prefer Coles Group Ltd (ASX: COL) at current levels.

The broker has a neutral rating and $36.80 price target on Woolworths’ shares at present. This compares to the current Woolworths share price of $39.26.

The post Own Woolworths (ASX:WOW) shares? Here’s what to look for during reporting season appeared first on The Motley Fool Australia.

Should you invest $1,000 in Woolworths right now?

Before you consider Woolworths, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Woolworths wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

Pricing power shares like Woolworths (ASX:WOW) help fight inflation: expert
ASX 200 Weekly Wrap: ASX grinds to a halt following new all-time high

Woolworths (ASX:WOW) share price struggles amid NZ duopoly concerns
Why the Endeavour (ASX:EDV) share price just hit a new all-time high
July has been a great month for the Woolworths (ASX:WOW) share price

Motley Fool contributor James Mickleboro does not own any shares 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 owns shares of and has recommended COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!