3 stocks dumped in a rising market
By Mike King - January 10, 2013
The S&P / ASX 200 Index (Index: ^AXJO) (ASX: XJO) has risen 0.3%, to close at 4,723, after stronger-than-expected Chines trade data. China’s exports grew by 14.1% in December 2011 compared to 2011, smashing analyst expectations of a 4% rise.
A booming Chinese economy is good news for Australia’s economy, given China is our biggest trade partner, and receives a large chunk of our natural resources.
The Australian dollar has continued its stay above parity with the US dollar, currently buying 105.5 US cents.
Despite the market rising, these three stocks lost 4% or more.
Skilled Group Limited (ASX: SKE) fell 4.4% to close at $2.61. The labour recruitment business is heavily tied to the resources sector, and the company’s share price can be volatile depending on the mood of the market. Skilled is implementing a cost-reduction strategy that delivered an 85% increase in net profit last year, and will continue to run the strategy over the next few years, according to the company’s CEO. Skilled could be a stock to watch in 2013.
M2 Telecommunications Group (ASX: MTU) lost 4.1% to close at $4.01, which may be a result of profit taking, given the share price had rallied by close to 20% since late November, and 48% over 2012. M2 expects to report a profit of between $43 to $48 million (including one off items), and earnings per share of between 27 to 30 cents, up 13% on last year’s result. M2 could be another company to watch in 2013.
Maverick Drilling and Exploration’s (ASX: MAD) share price continues its fall, ending the day at 72 cents, down 4%, and is now trading at less than half the high of $1.49 it hit last year. Despite having proven reserves of more than 100 million barrels of oil, the company may be struggling to monetise those reserves. Additionally, the company noted late in November 2012, that there were a number of warrant products with stop loss levels in the range from 96 cents to 75 cents, which may have triggered additional selling of the stock.
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Motley Fool writer/analyst Mike King owns shares in M2 Telecoms and Maverick. The Motley Fool’s purpose is to help the world invest, better. Take Stock is The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it’s still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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