Citi trims earnings estimate for Aussie retailer Woolworths with BIG W in focus

Coles

01/05/2025 21:29

** Analysts at Citi cut FY25 EBITDA estimate for top grocer Woolworths Group WOW.AX by about 4% with 2% downgrades thereafter

** Brokerage lowers estimate citing an uncertain outlook for WOW's discount chain unit BIG W, which now expects second-half loss before interest and tax to be about A$70 million ($44.67 million), up from previous forecast of A$40 million

** Compared to smaller rival Coles COL.AX, which saw a 3.4% rise in its quarterly group sales, Citi says it appears to be having the better operating momentum and is closing the gap to Woolworths in online business

** "We hold our view that on an underlying basis Woolworths is still underperforming Coles" — Citi

** Brokerage retains neutral rating and target price of A$33 per share

** Stock rated "hold" on average; median price target is A$31.85 per share — data compiled by LSEG

** WOW last up 4.8% YTD

($1 = 1.5669 Australian dollars)

(Reporting by Jasmeen Ara Shaikh in Bengaluru)

((JasmeenAraIslam.Shaikh@thomsonreuters.com;))