Coles vs Woolworths shares: Which supermarket giant has the biggest upside for 2026?

The war between Australian supermarket giants Woolworths Group Ltd (ASX: WOW) and Coles Group Ltd (ASX: COL) doesn’t stop on the shelves; it extends into the sharemarket too. Shares of both retailers are neck and neck this year, but who comes out on top when it comes to the outlook for the remainder of 2026?

What’s the outlook for Woolworths shares this year?

At the close of the ASX on Thursday afternoon, Woolworths shares were up 0.59% to $30.59 a piece. For the year to date, the retailer’s shares are up 3.94% and the stock is now 0.26% above trading levels this time last year.

The supermarket giant’s shares crashed nearly 20% in August last year after it posted a disappointing FY25 result. The stock dropped to an all-time low of $25.91 a piece in mid-October but was saved from any further decline after the company posted a more positive first-quarter sales update.

The business is well established and one of the largest in Australia, and this dominance maintains its competitive position in the retail space.

Analysts are divided about Woolworths shares right now. TradingView data shows that 7 out of 17 analysts have a buy or strong buy rating on the stock. The other 10 analysts have a hold rating.

The average target price is $30.70 a piece, which implies a 0.37% upside at the time of writing. The maximum target price is $37 per share, which implies a potential 20.95% increase for investors this year.

What’s the outlook for Coles shares this year?

At the close of the ASX on Thursday afternoon, Coles shares were up 0,29% to $21.05 a piece. For the year to date, Coles shares have slid 1.36% but they’re still 7.73% above trading levels seen this time last year.

Coles’ 2025 growth strategy paid off. The business posted a strong quarterly update in late October, where it reported a 3.9% increase in group sales and overall results in line with analyst expectations. 

The supermarket giant could face some headwinds from inflation and cost-of-living pressures this year, but the stock is very defensive and the business is well-positioned to be resilient among pressures. 

Analysts are pretty positive about Coles shares. TradingView data shows that 10 out of 17 analysts have a buy or strong buy rating on the stock. The other 7 analysts have a hold rating.

The average target price is $23.64 per share, which implies a 12.32% upside at the time of writing. Meanwhile, the maximum target price of $25.50 implies a potential 21.14% upside ahead for investors, using the current share price.

And the winner is…

At a maximum of 21.14%, Coles shares have a larger maximum potential upside than Woolworths shares in 2026, according to analysts. Its business has strengthened over the past year, and sentiment about the company’s potential is much more positive. Between the two supermarket giants, I’d say Coles has the upper hand right now. 

The post Coles vs Woolworths shares: Which supermarket giant has the biggest upside for 2026? 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 no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Woolworths Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.