Image source: Shutterstock

Highlights

  • Q1 revenue up 13% YoY to $3.32B, but production and sales fell short of expectations.

  • Citi and Morningstar revise earnings forecasts, citing project delays and weaker LNG prices.

  • Shares down 17% YTD as analysts remain divided on stock’s outlook.

Australia’s top gas producer, Woodside Energy Group Ltd (ASX:WDS), is facing fresh scrutiny from analysts after reporting first-quarter results that fell short of market expectations. The company posted Q1 revenue of $3.32 billion, up 13% from a year earlier, yet both production volumes and realized prices came in lower than anticipated, prompting model revisions from leading research houses including Citi and Morningstar.

According to Citi, the revenue miss stemmed primarily from lower output at the Pluto LNG project in Western Australia and the timing of cargo deliveries from the Sangomar field in Senegal. As a result, the firm has revised its financial model for Woodside, forecasting earnings to fall by around 7% in calendar year 2025. However, Citi remains more optimistic about the medium term, projecting a 3% to 5% earnings uplift in 2026 and 2027 as project timelines normalize and production ramps up.

Morningstar has taken a similar view, cutting its 2025 earnings per share forecast by 7% to US$1.29. The firm cites weather-related disruptions and softer LNG prices as key drivers of the downgrade. Despite the downward revision, Morningstar still sees production reaching 195 million barrels of oil equivalent (boe) in 2025, which would place output at the upper end of the company’s guidance range.

The mixed quarterly performance and subsequent analyst revisions have contributed to ongoing market pressure on Woodside’s shares. The stock is down 17% year-to-date, slightly underperforming the broader S&P/ASX 200 Index, which has fallen 17.4% over the same period. Analyst sentiment remains split, with 5 out of 13 analysts rating the stock a “Buy” and 8 maintaining a “Hold” stance, according to consensus data compiled by LSEG. The median 12-month price target currently stands at AU$26.

While short-term earnings are under pressure, some analysts argue that Woodside’s diversified portfolio and upcoming project milestones could support a recovery in the medium term.