Woolworths Group (ASX:WOW) Could Be 2% Below Fair Value After Supply Chain Focus

Event context for Woolworths Group

Woolworths Group (ASX:WOW) drew fresh attention on 23 September 2026 after investors revisited the retailer's role in essential groceries and business supply chains across Australia and New Zealand.

The renewed focus relates to the group's broad exposure to everyday spending across its Australian Food, New Zealand Food, Australian B2B and W Living segments. Together these operations influence how resilient earnings may appear in different conditions.

Recent trading tells a mixed story for Woolworths Group. The share price is A$38.47, with a 1-day share price return of 0.52% and year to date share price return of 30.72%. However, the 30 day share price return is down 4.26% and the 90 day share price return is down 4.40%. At the same time, longer run performance looks stronger, with a 1 year total shareholder return of 47.27% and a 5 year total shareholder return of 15.40%. This indicates that near term momentum has cooled following a solid multi year run.

Scan across consumer staples with similar defensive spending patterns by reviewing the hand picked 7 resilient stocks with low risk scores alongside Woolworths Group.

Woolworths Group looks like a solid everyday essentials business, yet the share price has already run hard over the past year. So is the market overpaying for that stability, or still underestimating it?

Most Popular Narrative: 2% Undervalued

The most followed view on Woolworths Group pegs fair value around A$39.20, slightly above the last close at A$38.47, which leaves a modest valuation gap that depends heavily on how the long term earnings story plays out.

The ongoing investment and upgrades in Woolworths' supply chain automation and distribution centers are expected to drive significant operational efficiencies and margin improvement over the next few years, as dual running and commissioning costs roll off and new facilities like Moorebank and Auburn CFCs deliver returns, which is likely to support higher future EBIT and ROIC.

See why 82 investors see Woolworths Group as 2% undervalued .

Result: Fair Value of A$39.20 (UNDERVALUED)

Still, Woolworths Group faces pressure from higher retail wages and intense price competition, either of which could squeeze margins and challenge the view that the stock is undervalued.

Find out about the key risks to this Woolworths Group narrative .

Another View on Woolworths Group Valuation

There is a different read on Woolworths Group when looking at the P/E. The shares trade on 41.2x earnings, which is far above the global Consumer Retailing average of 15.6x and also above an estimated fair ratio of 29.6x. That gap can point to rich expectations if growth or margins disappoint.