Up 30% in a year, can buying Woodside shares today still create long-term wealth?

Here's what the future might hold for the ASX 200 energy giant.

| More on:
Worker inspecting oil and gas pipeline.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The Woodside share price has risen 34% over the last 12 months to trade at $36.31 at the time of writing
  • It's been driven higher amid soaring oil and gas prices, spurred by Russia's invasion of Ukraine
  • Some experts are tipping energy commodity prices to remain high in the coming years, while Woodside aims to invest $5 billion in cleaner energy

Those invested in Woodside Energy Group Ltd (ASX: WDS) shares have had a ripper year. The stock has soared a whopping 34.89% in that time to trade at $36.46 today.

And sending it sky high has been the price of energy commodities – specifically oil and gas.

Woodside is a producer of the black liquid, which saw a spike in demand amid Russia's invasion of Ukraine.

Indeed, the S&P/ASX 200 Index (ASX: XJO) energy giant saw its realised oil price more than double in the first half to US$96 a barrel.

Its oil production also soared 19%, helped along by the company's merger with BHP Group Ltd (ASX: BHP)'s petroleum assets.

But can Woodside shares still offer long-term wealth creation following its massive year?

Do Woodside shares still offer future gains?

Created with Highcharts 11.4.3Woodside Energy Group PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.com.au

One factor is seemingly bolstering hope that Woodside shares could be a long-term winner. Surprise, surprise, it's oil prices.

Brent crude is currently trading at around US$84 a barrel, and that's tipped to grow.

Goldman Sachs is expecting oil to retrace its steps, returning to trade at around US$100 a barrel, as my Fool colleague Bernd reports.

Meanwhile, Allan Gray fundie Dr Suhas Nayak believes the market has undervalued Woodside shares amid expectations the black liquid's value could fall. But any falls could still be years away.

He expects years of underinvestment in the energy space could see demand for oil continue, thereby bolstering prices over the longer term. That would be good news for the ASX 200 energy giant's bottom line.

Looking even further into the future, however, demand for oil and gas could fall significantly on the back of the energy transition. Fortunately, the company is far from unaware.

Woodside is aiming to invest $5 billion in new energy products and lower-carbon services before the end of the decade.

Additionally, it has four hydrogen projects on the go – located in Western Australia, Tasmania, Oklahoma, and New Zealand. It also has plans for two solar projects in place.

Still, without a crystal ball it's hard to say what might come of Woodside shares over the coming years and decades.

Though, it's worth noting the company's earnings per share (EPS) is tipped to grow to around $3.79 in financial year 2023, according to CommSec data. It's then forecast to slip to $3.34 in financial year 2024 and to $2.82 in financial year 2025.

Should you invest $1,000 in Woodside Petroleum Ltd right now?

Before you buy Woodside Petroleum Ltd shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Woodside Petroleum Ltd wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 9 January 2025

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Energy Shares

Gas and oil plant with a inspector in the background.
Energy Shares

2 ASX utilities shares poised to win big in 2025

These two names are set to deliver the goods this year, according to brokers.

Read more »

A woman jumps for joy with a rocket drawn on the wall behind her.
Energy Shares

Guess which ASX uranium stock could rocket over 100%

Bell Potter thinks this is a high risk, high reward option for investors.

Read more »

A woman stacks smooth round stones into a pile by a lake.
Share Market News

Here's how the ASX 200 market sectors stacked up last week

ASX energy shares led the market with a 3.19% increase while the benchmark ASX 200 rose by just 0.2%.

Read more »

A miner in visibility gear and hard hat looks seriously at an iPad device in a field where oil mining equipment is visible in the background.
Energy Shares

Down 60% from all-time highs, can Woodside shares turn around in 2025?

Can Woodside re-energise investors about its future?

Read more »

A person leans over to whisper a secret to a colleague during a meeting.
Energy Shares

Why the Santos share price 'continues to look undervalued' in 2025

The experts at Firetrail believe the Santos share price is still undervalued.

Read more »

Multiracial happy young people stacking hands outside - University students hugging in college campus - Youth community concept with guys and girls standing together supporting each other.
Energy Shares

ASX All Ords uranium stock rockets 12% on big US news

Investors are piling into the ASX uranium producer on Tuesday. But why?

Read more »

the australian flag lies alongside the united states flag on a flat surface.
Energy Shares

Did Joe Biden just boost the 2025 outlook for ASX 200 energy shares?

ASX 200 energy shares have been burning bright so far in 2025.

Read more »

Three happy office workers cheer as they read about good financial news on a laptop.
Energy Shares

Guess which ASX uranium stock could rise 28% in 2025

Bell Potter believes a bull market is coming for uranium and this stock could be a buy.

Read more »