Woolworths Group (ASX:WOW) first quarter of fiscal 2026 shows "pleasing" investment in value & inventory to address competitive position & availability, but it's too early to definitively say this is improving sales, said Jefferies in a Wednesday note.

The company on Wednesday posted total group sales of AU$18.48 billion for the fiscal first quarter, up from AU$18 billion a year earlier. Total Australian food sales rose to AU$13.89 billion for the 14 weeks ended Oct. 5, from AU$13.61 billion a year earlier.

Australian food sales were slightly below Jefferies' estimate but slightly ahead in other divisions, with "apparent" acceleration in Australian food in the early second quarter.

The investment firm said it is reticent to put much weight on a three-week period, and until Coles (ASX:COL) reports, it's unclear whether this was driven by relative improvement or market factors.

Jefferies has kept a buy rating on Woolworths with a price target of AU$28.50.

The company's shares rose past 2% in recent Thursday trade.