Woolworths Group Ltd (ASX: WOW) has been one of the more eventful ASX 200 companies in 2021, with the Woolworths share price climbing 11.3% so far this year.
At the time of writing, the Woolworths share price is trading 1.35% higher at $37.67.
To bring you up to speed, we look at what analysts are expecting from Woolworths shares next.
Broker thoughts on the Woolworths share price
While investors are shopping for a buy, some leading brokers believe Woolworths shares might be worth skipping at the checkout.
For example, analysts at Credit Suisse have downgraded the supermarket operator’s shares to an underperform rating. According to the note, the broker considers the Woolworth share price expensive at current levels, with shares trading at roughly 30 times FY22 estimated earnings.
Additionally, Credit Suisse analysts point out that the company is trading at a significant premium to its rival, Coles Group Ltd (ASX: COL). For this reason, the broker holds a $32.92 price target, representing a possible ~13% downside to the Woolworths share price.
Goldman’s take on Woolworths
Another leading broker that thinks any near-term upside is now priced in is Goldman Sachs. Just over a week ago, the broker released its updated rating after adjusting its estimates to account for the recent demerger.
As a result, Goldman downgraded the company’s shares to a neutral rating and a $36.80 price target. This would imply a potential downside of 2.4% to the Woolworths share price.
However, this estimate excludes the blue chip’s dividends. The broker’s 12-month estimated returns come to -0.1% with payments included from today’s share price.
Compared to latest close of A$37.85, our revised 12m target price of A$36.80 offers a total potential return of -0.5%. While the short-term catalyst of an off-market buyback remains in play, we are taking advantage of the current strength in WOW to downgrade to neutral.
Since we upgraded WOW to a buy rating on 7 March 2021 the share price has appreciated 14.1% prior to the demerger vs. the market up +8%
Goldman Sachs
Based on the current Woolworths share price, the supermarket giant holds around $47 billion market capitalisation.
The post Here’s what leading brokers say about the Woolworths (ASX:WOW) share price in July appeared first on The Motley Fool Australia.
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More reading
- Woolworths (ASX:WOW) share price dips as experts predict growth
- These ASX shares are the latest to be hit by broker downgrades
- ASX 200 Weekly Wrap: ASX finishes FY21 on a high
- ASX blue chips set to unleash buybacks and dividends! But which is better?
- Why Lendlease, Marley Spoon, Reece, & Woolworths shares are sinking
Motley Fool contributor Mitchell Lawler 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 Bruce Jackson.
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