The Aussie stock market has cut a forlorn figure since early 2015. Since the S&P/ASX 200 came within a whisker of 6,000 points back in April, the market has slumped by around 20%.

The gloomy outlook has put a lot of listed companies under pressure. It shouldn’t surprise you that there are far more stocks trading at 52-week lows on the ASX than at 52-week highs. Many household name stocks are cheaper today than at any point of the past year or longer.

Let’s take a look at two well-known Aussie stocks that have fallen to 12-month lows — Incitec Pivot Ltd (ASX: IPL) and Amcor Limted (ASX: AMC) — and see if their share price declines are justified.

Why Have Incitec Pivot and Amcor shares dropped to 12-month lows?

Incitec Pivot makes and distributes industrial explosives and fertilisers. As such, its fortunes are strongly linked to those of the mining sector.

Incitec Pivot has battled gamely through the Aussie mining bust by cutting costs and paying down debt, but it’s an environment that leaves no room for error. That’s why investors savaged Incitec Pivot shares in January after a supply train derailed in Queensland, wiping an estimated $14 million from full year net profit after tax.

More importantly, fertiliser prices have been weak — which has seen investors shun Incitec Pivot in a soft stock market. Incitec Pivot shares are down nearly 24% over the past year.

Packaging giant Amcor traded sideways through much of 2015’s weakening stock market environment. Strong returns on funds employed by its plastics and packaging businesses insulated Amcor from much of the market malaise.

So far in 2016, the market has responded negatively to Amcor’s acquisition of an American and a Chinese packaging business for a total outlay of around US$58 million, and to a management shakeup in Asia.

Investors seem to be bracing themselves for a downbeat half-year profit announcement later this month. Amcor shares are down around 6% since this time last year.

What’s next for Incitec Pivot and Amcor shares?

Incitec Pivot seems a risky bet. The supply and demand dynamics of the fertiliser market do not seem to be moving in Incitec Pivot’s favour. Its share price has not yet fallen into ‘deep value’ territory and investors seem to be factoring in an uplift from Incitec Pivot’s investment in an ammonia plant in the US. The bar seems high for Incitec Pivot to impress investors in this environment and you can’t discount the risk of a profit warning over the next three months.

Meanwhile, the fundamentals of Amcor’s business seem intact. The Amcor share price seems to have dropped in sympathy with the broader market and on the basis of foreign exchange movements. Amcor strikes me as a stock with defendable growth characteristics. In a market where investors are scratching around for reliable growth prospects, that makes a stock like Amcor unlikely to fall too far out of favour.

Foolish takeaway

A market downturn often gives you a chance to invest in a decent business at a discount price. Before you buy a stock just because it looks cheap on a chart, think about the riskiness of its industry and the strength of its competitive position. A little analysis can go a long way in avoiding investment landmines.

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Motley Fool contributor Tim Dohrmann has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.