Woolworths share price: where next as Q3 sales hit $16.5 billion?

After experiencing a surge in sales during March, Woolworths has seen its food and liquor sales moderate in recent weeks, as panic buying subsides.

Coles Group (COL) revealed a strong set of quarterly results on Wednesday, reporting that quarterly revenue from its supermarkets division had jumped 13.8% as a result of Covid-19.

Unsurprisingly, when Woolworth Group (WOW) – a key rival of Coles – reported its own set of quarterly results, the supermarket giant also saw its food sales climb as a result of Covid-19-led pantry loading.

Overall, Woolworths delivered growth in all of its divisions bar one (hotels), recording third-quarter (Q3) sales revenue of $16,495 million, representing an impressive increase of 10.7% on the prior corresponding period.

'The last four months have been one of the most challenging periods in the history of Woolworths. Our team is doing an incredible job of responding to these unprecedented challenges and I want to thank them for their amazing efforts,' said Woolworths Group chief executive officer (CEO), Brad Banducci.

Woolworths share price: growth across the board, almost

During the quarter, the Group’s supermarkets division delivered strong growth, posting total sales of $11,171 million, representing an impressive growth rate of 11.3% on the prior corresponding period.

Comparable sales growth climbed 10.3% during the quarter, compared to just 4.2% a year ago

Illustrating just how pronounced Covid-19 ‘pantry loading’ became, it was noted that while during the first seven weeks of the quarter growth was mostly in line with prior periods, from 1 March onwards Woolworths saw a material uptick in sales, which 'peaked in the week ending 22 March with growth of over 40%'.

Woolworths New Zealand food division also witnessed strong growth, recording total sales for the quarter of $1925 million, representing a growth rate of 13.7% on the prior corresponding period.

Elsewhere, Big W and Endeavour Drinks also recorded sales growth for the quarter; while Hotels, which experienced government mandated closures from 23 March onwards, saw its sales drop off 12.9% for the quarter.

Woolworths (WOW) finished out today’s session down 25 cents, or 0.69%, to $35.78 per share.

Where next: an uncertain outlook

Like Coles, Woolworths noted that sales across its supermarkets and liquor divisions had begun to moderate during the early parts of April.

'Food sales growth in the first three weeks of April is in the mid-single digits with Drinks sales growth broadly back to pre-Covid-19 levels,’ it was noted.

Ultimately, the FY sales outlook remains difficult to predict given the deeply uncertain economic outlook.

Mind you, while the Covid-19 pandemic may have led to an increase in quarterly sales, it has also created a number of new costs for the Group – which are expected to remain into Q4.

Moreover, looking forward, the outlook remains one marred by uncertainty, with Woolworths’s management team noting that:

'The longer-term impact of the crisis is uncertain however, in the likely event of a more challenging medium-term economic environment, the Group remains well positions through its focus on food and everyday needs, convenience (ecommerce and in-store) and value.'

How to trade Woolworths – long or short

What do you make of Woolworths quarterly results: do you see bullish or bearish opportunities? Whatever your view, you can use CFDs to trade the likes of Woolworths and Coles – long or short through IG’s world-class trading platform now.

For example, to buy (long) or sell (short) Woolworths, follow these easy steps:

  1. Create an IG trading account or log in to your existing account
  2. Enter ‘WOW’ in the search bar and select it
  3. Choose your position size
  4. Click on ‘buy’ or ‘sell’ in the deal ticket
  5. Confirm the trade

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
Sell
Buy
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Sell
Buy
Updated
Change

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Sell
Buy
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
China 300
-
-
-
-

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.