Woodside Energy Group (WDS – Research Report), the Energy sector company, was revisited by a Wall Street analyst today. Analyst Matt Chalmers from Bank of America Securities reiterated a Buy rating on the stock and has a A$26.90 price target.
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Matt Chalmers has given his Buy rating due to a combination of factors influencing Woodside Energy Group’s potential. The company has updated its 2P reserves with an increase of 46 million barrels of oil equivalent, which signifies strong recoverability prospects, particularly with the Sangomar reserve additions. Despite higher than estimated depreciation and amortization costs, Woodside’s production costs remain aligned with market expectations, and the company is trading at a favorable price-to-net present value ratio.
Moreover, the anticipated tightening of the Asian LNG market due to high European gas prices supports Woodside’s strategy of selling a significant portion of its LNG at prices linked to gas hubs, distinguishing it from competitors. The potential extension of the North West Shelf Project and Woodside’s increased stake following asset exchanges further enhance its long-term commercial viability. These strategic elements, combined with supportive market conditions, underpin Chalmers’s confidence in a Buy recommendation for the company’s stock.