Is the Wesfarmers share price a buy following the company’s latest results?

The Wesfarmers Ltd (ASX: WES) share price has remained relatively flat since the release of the company’s full year results.

At the end of the week, the conglomerate’s shares finished relatively flat with a slight 0.04% increase to $46.71 during its Friday trading session.

Let’s take a brief look at how the company performed and what one prominent broker is saying.

How did Wesfarmers perform in FY 2022?

The Wesfarmers share price has been seesawing lately despite the company posting a strong second-half performance.

As reported by my Motley Fool colleague Brooke Cooper, Wesfarmers delivered an 8.5% increase in revenue to $36.8 billion. This came on the back of the company’s strong recovery from COVID-19 lockdowns and absenteeism in the first half of FY 2022.

On the bottom line, Wesfarmers experienced a slight fall of 1.2% in net profit after tax (NPAT) to $2.35 billion. 

Subsequently, the board opted to declare a fully franked final dividend of $1 per share which was 11.1% higher than the prior corresponding period.

On the day of the results, Wesfarmers shares dipped 1.15% to finish at $47.40.

Are Wesfarmers shares a buy?

One broker weighed in on the company’s shares following the release of its full-year results.

The team at Goldman Sachs stated that Wesfarmers’ performance showed growth headwinds amidst higher investments.

In that respect, the broker stated the following:

We change our FY23/24 NPAT by 2.0% and 1.7% respectively to factor in the stronger results and updated outlook.

Goldman Sachs rolled forward its valuation to be based on FY 2024 estimates and increased its Wesfarmers share price target to $38.90 apiece. Based on the current share price, this implies a downside of 16.7% for investors.

Furthermore, its analysts reiterated a sell rating on Wesfarmers shares.

Wesfarmers share price snapshot

Over the past 12 months, the Wesfarmers share price has fallen by 19%. Likewise, the share is down 21% year-to-date.

Wesfarmers commands a market capitalisation of around $53.30 billion, making it the tenth largest company on the ASX.

The post Is the Wesfarmers share price a buy following the company’s latest results? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras 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 Wesfarmers Limited. 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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