The Woodside Petroleum Limited (ASX: WPL) share price has moved mostly sideways since the beginning of the year, down 10%.
Undoubtedly, COVID-19 has weighed heavily on oil prices as the world attempts to restart the economy.
Woodside deals in the energy industry, supplying oil and liquified natural gas (LNG) to its customers. The spot price of oil and LNG contracts heavily affects the company's share price.
At one point in 2020, the spot price of oil went into negative territory, a first in the history books. However, the commodity has since somewhat recovered.
The West Texas Intermediate (WTI) is currently fetching US$68.41 per barrel, up 1.47% for today. In addition, its more expensive brother, Brent crude, is trading for $72.11, up 1.46%.
WTI is sourced from oil fields in the United States and is lighter due to its low density and low sulphur content. Brent crude on the other hand is sourced from the North Sea between the Shetland Islands and Norway, and is popular to refine into diesel fuel and gasoline.
What would have happened to your Woodside investment in 10 years?
If you had invested $1,000 in Woodside shares in 2011, you would have bought them for around $35.48 each. This would have given you approximately 28 shares.
Looking at today's closing price, Woodside shares are trading at $20.28. This means those 28 shares would now be worth a paltry $567.84 (28 shares x $20.28). When considering percentage terms, this implies a decline of around 43%, or a yearly average loss of 5.50%.
This is a mammoth fall, particularly considering the S&P/ASX 200 Index (ASX: XJO) has headed the other way with an average of 5.96% per annum over the last 10 years.
Are Woodside shares a buy?
Since the release of Woodside's FY21 half-year result, a few brokers have weighed in on the company's share price.
Swiss investment firm UBS cut its price target for Woodside shares by 5% to $24.80. Citi followed suit to also reduce its rating by 11% to $21.55. The most recent broker note came from Macquarie, which has initiated a bullish price of $27.60 for the energy producer's shares.
Based on the current Woodside share price, Macquarie's 12-month price target implies an upside of roughly 36%.
Over the past 12 months, Woodside shares have failed to make any significant movements, up 8%. Year-to-date, however, the company's shares are down about 3%.
Woodside commands a market capitalisation of roughly $21.2 billion, with 963 million shares on its registry.
