The Westpac Banking Corp (ASX: WBC) share price has travelled higher throughout 2021, lifting close to 30%. These gains could be considered impressive for a blue-chip banking share in any other year. However, the onset of the COVID-19 pandemic in early 2020 has meant many ASX shares are trading off low comparables from March 2020.
Westpac shares hit a multi-decade low of $13.47 when the ASX crashed early last year. Prior to that, you would have to go back to the 2008 global financial crisis to pick up the company's shares at that price.
And with the pandemic and associated lockdowns continuing to wreak havoc across Australia and the world, we take a look at how Westpac shares have historically performed when prior lockdowns have lifted.
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A glimpse of Westpac shares during lockdowns
Looking at the Westpac share price chart and the timings of previous lockdowns, there does appear to be a correlation between the pair.
During Australia's first lockdown in early 2020, particularly the months-long Victorian stage 4 restrictions, Westpac shares tumbled to bargain prices, along with the wider share market. It wasn't until there was an end in sight to reopening the economy in May 2020, that the bank's shares began to pick up.
Victoria again went into another harsh lockdown in June 2020 following new locally acquired cases of COVID-19. This sent Westpac shares trending downwards, tumbling from as high as $20.19 on 9 June to around $16.00 in September 2020. Once the Victorian Government signalled it had overcome the current outbreak enough to start opening up, Westpac shares surged to above $20 by November.
Fast-forward to last month, the company's shares were enjoying pre-pandemic highs of almost $26 until COVID-19 struck once more. For the past 3 weeks, Westpac shares have been declining overall as the country grapples with the latest outbreak. New South Wales recorded 268 new cases yesterday, totalling 1,764 cases last week alone.
At Friday's market close, Westpac shares last traded at $25.12. This reflects a decline of around 7% from their 52-week high of $27.12 achieved in mid-June this year.
It's widely known that when lockdowns come into effect, much of the Australian economy suffers. But it appears that the Westpac share price is also negatively impacted by these restrictions. However, in the past, as restrictions have eased and businesses resume trading, the company's shares have tended to push higher.
Is the Westpac share price a buy?
Investment firm, Bell Potter recently upgraded its rating on Westpac shares to $26.50, adding 18% to its 12-month price target. This implies an upside of roughly 5% based on the current Westpac share price.
