Is it time to sell your Wesfarmers shares?

Wesfarmers Ltd (ASX: WES) shares were 0.098% higher at the close of the ASX on Wednesday afternoon, at $81.72 a piece. The stock crashed nearly 15% at the end of October following the retail company’s annual general meeting (AGM). This has dragged Wesfarmers shares 2.96% lower over the past month. For the year to date, the shares are still 14.42% higher.

What happened?

At the Wesfarmers’ AGM, management spoke positively about the company’s performance so far in FY26. They said that year-to-date sales growth in its Bunnings business was ahead of the growth recorded in the second half of FY25, supported by solid trading in the consumer segment. 

Management also said that its Kmart Group has benefited from “strong value credentials and quality” of its Anko product range, with year-to-date sales growth broadly in line with the second half of the 2025 financial year.

However, management did say that its Industrial and Safety division isn’t performing as strongly, citing that “trading conditions remain challenging, with earnings impacted by subdued demand across the mining and resources sectors”.

And it looks like investors were unimpressed by the company’s AGM announcement. 

Is there any upside ahead? 

Data shows that analysts aren’t too positive on the outlook for Wesfarmers shares. Out of 15 analysts, 7 have a sell or strong sell rating. Another 7 have a hold rating, and 1 has a strong buy rating.

The average target price is $81.25, implying a 0.57% downside from the current share price. Although some analysts think the shares could fall another 22.17% to around $63.60 over the next 12 months.

Are Wesfarmers shares worth holding for passive income though?

It’s true that while the Wesfarmers share price might have tumbled recently, and the outlook for its share price isn’t positive, investors need to factor in the passive income that Wesfarmers dishes out to its investors. The company continues to be one of the most effective ASX blue-chip shares to own over the long term. 

That’s because, while Wesfarmers is famous for its well-known retailers Bunning and Kmart, it also owns several other businesses. This diversity helps the company maintain a strong track record of delivering growth while consistently increasing dividends for shareholders. 

For FY25, the Wesfarmers board of directors decided on a fully franked final dividend of $1.11 per share. That brings the full-year dividend to $2.06 per share, representing a year-over-year increase of 4%. The full-year dividend represents 88% of underlying earnings per share.

So is it time to sell up? I think I’d sit and wait for now. Wesfarmers shares are a long-term play.

The post Is it time to sell your Wesfarmers shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Wesfarmers. The Motley Fool Australia has recommended Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.