With 8% yield, are Woodside shares a dividend no-brainer buy?

Woodside Energy Group Ltd (ASX: WDS) shares could be looking cheap right now, according to experts.

Part of this reason is due to its annual dividend yield of 8.22%, which is one of the highest on the ASX, as well as a healthy fully franked dividend of $1.60 per share which was paid in October.

Shares of the global energy company are currently up 3.32% today, trading at $37.96 apiece.

The energy sector as a whole is in the green, too. In fact, the S&P/ASX 200 Energy Index (ASX: XEJ) is today’s best-performing sector index by a wide margin, currently up 2.82%.

Zooming out, the S&P/ASX 200 Index (ASX: XJO) is up 0.27% at the time of writing.

So let’s look at why a fund manager believes the Woodside share price could be heading higher.

What did the fund manager say?

Plato Investment Management managing director Don Hamson made some bullish comments about Woodside shares via Livewire today.

Hamson was asked to name a long-term sustainable dividend payer for 2023, with the requirement of also having a high dividend yield.

Hamson rated Woodside as a buy and said:

Well, we like the energy stocks, and we like that outlook. And longer term, we think Woodside’s a great stock. It’s got some quality assets. I know it’s in fossil fuels, but gas and LNG are on the pathway to lower emissions. It’ll help us get there. Obviously, it is benefiting from the Ukrainian crisis, but we think it’s got a great dividend outlook for a number of years.

Other experts also believe Woodside is a buy

Hamson was not the only one with a positive assessment of Woodside shares during October.

ThinkMarkets market analyst Carl Capolingua said he was bullish on Woodside’s positioning in the natural gas market. Capolingua believes there will be a natural gas shortage in the future and likes that 80% of Woodside’s business comes from this resource.

Earlier in the month, The Motley Fool’s Bruce Jackson picked Woodside as a buy due to its “dirt cheap” valuation and strong business fundamentals.

Jackson said:

Woodside is a beneficiary of the high oil and gas prices, and the lower Aussie dollar. It’s hard to imagine a better macroeconomic environment, yet at the same time, it’s equally hard to imagine what could derail the Woodside juggernaut.

Jackson also outlined other reasons to be bullish on Woodside shares, including the fact it is one of the highest-yielding ASX 200 stocks.

Woodside share price snapshot

The Woodside share price is up 72% year to date. At the same time, the ASX 200 is down 8% over the same period.

The company’s market capitalisation is around $69.76 billion.

The post With 8% yield, are Woodside shares a dividend no-brainer buy? appeared first on The Motley Fool Australia.

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Motley Fool contributor Matthew Farley 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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