Are Woolworths Shares Still a Buy Near 52-Week High?

WOW showcases a strong recovery, support by robust performance, improved operational efficiency and investor confidence led by strong company’s fundamentals.

Woolworths Group Limited (ASX: WOW)

Woolworths Group Limited (ASX: WOW) has recovered on the ASX in recent months. The consumer defensive company is up ~21% from its recent low in May 2026 and is near to 52-week high reflecting strong investors’ confidence. 

Currently, the company has gained 28% over the last 12 months and has bounced back 52% from its 52-week low, with a market capitalization of $47.97B. The company currently offers a full franked annual dividend yield of 2.29% and has a P/E ratio of 81.12.

Excellent Execution

WOW is a market leader with a 37% market share and has delivered a strong Q3 FY26 result, where their group sales rose by 4.5% YoY to $18.1B. The Australian food business surged 5.9% YoY to $13.8 b contributing 76% of group revenue, whereas Group ecommerce sales reached $2.7B (+20.2%) with a group VOC NPS of 47 (+3 points YoY). The BIG W sales also up 3.9% showcasing quality of sales remains strong and others grows by 13.6%, while the Zealand Food (AUD) is down by 5.2% due to slower market.

Company’s half yearly results also reflecting the same where group revenue is up 3.4% to $37.1b, with a Group EBIT $1.66 b (+14.4%) with EBIT margin of 4.5% and underlying NPAT surged by 16.4% to $859 m with NPAT margin of 2.3%. The massive growth in both EBIT and NPAT showcases company’s operational efficiency and performance which strengthen the confidence as an investor.

The Australian food business improved a lot with EBIT increased by 10% with an EBIT margin of 5.5% (+30-40 bps) and having a cash realization ratio of 95%. Also, they have given an interim dividend of 45 cents/share (+6 cents) reflecting management’s confidence in earnings sustainability and cash flow generation. 

Management Guidance

The management has highlighted in Q3 FY26 results that the company may suffer from higher fuel costs resulting in inflationary pressure across the supply chain giving less earning growth in Australian Food. The EBIT is expected to grow by mid to high single digit for FY26, showcasing management confidence on operational efficiency and performance.

While New Zealand food growth continued to be slow and the market remains highly competitive with discounter benefiting from a flight to value and BIGW business continue to grow at the same pace meeting the earlier expectations.

Outlook

WOW continues to deliver a strong operational performance, supported by resilient food demand, improved margins and growing e- commerce business. While recent performance of the stock reaching to its all-time high with consistent growth, strong cash generation and being the market leader provide long term stability.

However, the investors should be aware of the short-term challenges like rising fuel costs, competitive pressure and slower growth in the New Zealand segment. With management expectation of mid to high single digit EBIT growth for Australian food business and BIG W continuing the momentum, WOW appears well positioned for sustainable expansion. At current level, the stock may offer a balanced risk to reward opportunity for long term.

(Source: Company Report)