Woolworths shares jump 9% to all-time high: Buy, sell or hold?

Woolworths Group Ltd (ASX: WOW) shares are up around 1% to $41.66 at the time of writing on Tuesday afternoon.

At one point earlier this morning, the shares were trading at an all-time high of $41.78 a piece.

The shares have spiked 9% higher over the past two weeks alone, and they’re now up an impressive 41% for the year-to-date.

What has sent Woolworths shares flying higher?

The supermarket giant hasn’t posted any price-sensitive news since its FY26 results announcement in August.

The sky-high share price has most likely been driven by renewed investor confidence that the company’s turnaround story is finally coming to fruition, after a difficult period in 2025.

In late-August, Woolworths posted a 3.6% year-on-year increase in sales and a 6.7% increase in EBITDA (before significant items). On the bottom line, Woolworths achieved a 15.4% increase in its NPAT (before significant items) for the year. Management also declared a 52-cent per share dividend, up 15.6% from FY25.

There has clearly been a shift in investor sentiment, and I think more recently a sector-wide investor rotation towards more defensive assets (and away from riskier or high growth shares), and some fresh economic data, has helped to propel the share price higher.

Last week, The Australian Bureau of Statistics (ABS) released data showing that, in seasonally adjusted terms, Australia’s employment rate increased by 0.1 percentage point to 4.7% in September. 

This has significantly boosted investor confidence that the Reserve Bank will decide to hold interest rates steady at its next meeting on the 3rd of November, rather than implement another hike as originally feared.

Less chance of another near-term interest rate hike has eased financial pressure on households. This is great news for an ASX consumer staples stock like Woolworths. As the company also leases large-scale stores, warehouses and distribution centres, it is highly sensitive to higher interest rates and higher lease costs.

The shares could also be climbing higher ahead of the company’s first-quarter FY27 update and annual general meeting. These are scheduled for the 28th and 29th of October, respectively.

Are the supermarket shares a buy, sell, or hold now?

According to expert forecasts, Woolworths shares are trading above fair value and we could see a correction ahead.

Market Index data shows brokers are split between a hold and a sell rating. However, the $37.73 average target price implies a downside of around 9%, at the time of writing.

Sentiment is similar on TradingView, although the majority (nine out of 17) have a hold rating on the shares. Another six rate Woolworths as a sell/strong sell and two have a buy rating.

The average $39.71 target price, however, still implies a downside of around 4%, at the time of writing.

The post Woolworths shares jump 9% to all-time high: Buy, sell or hold? 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 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.