It's been a sad week for Woolworths Group Limited (ASX:WOW), who've watched their investment drop 13% to AU$28.80 in the week since the company reported its yearly result. It looks like a pretty bad result, all things considered. Although revenues of AU$69b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 31% to hit AU$0.78 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Following the latest results, Woolworths Group's 15 analysts are now forecasting revenues of AU$71.6b in 2026. This would be a modest 3.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to jump 58% to AU$1.24. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$72.0b and earnings per share (EPS) of AU$1.37 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

See our latest analysis for Woolworths Group

The average price target fell 6.8% to AU$30.51, with reduced earnings forecasts clearly tied to a lower valuation estimate. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Woolworths Group analyst has a price target of AU$33.70 per share, while the most pessimistic values it at AU$28.25. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Woolworths Group's revenue growth is expected to slow, with the forecast 3.6% annualised growth rate until the end of 2026 being well below the historical 6.3% p.a. growth over the last five years. Compare this to the 6 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 3.2% per year. So it's pretty clear that, while Woolworths Group's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

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The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Woolworths Group. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Woolworths Group's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Woolworths Group. Long-term earnings power is much more important than next year's profits. We have forecasts for Woolworths Group going out to 2028, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 3 warning signs for Woolworths Group that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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