Although the last three months have been kind to shareholders of Australia and New Zealand Banking Group (ASX: ANZ) and Fortescue Metals Group Limited (ASX: FMG), the same cannot be said for all shares on the ASX.
Whilst ANZ and Fortescue Metals' shares were busy climbing 18% and 25% respectively, the three shares listed below were making steep declines. Has this made them bargains buys or are they still best avoided?
Aconex Ltd (ASX: ACX)
In the last three months, the shares of this leading online project management software provider have plunged a whopping 19%. Despite this drop in its share price, its shares are still changing hands at 123x full year earnings. Whilst this does seem incredibly expensive and be off-putting for some investors, it is worth remembering that Aconex recently quadrupled its full-year net profit. I believe the company has explosive growth prospects that justify the premium. I'm not the only one with that view either. Investment bank Citi have placed an $8.91 price target on its shares, which is around 38% higher than the current share price.
iCar Asia Ltd (ASX: ICQ)
The owner and operator of ASEAN's leading network of automotive listings is attempting to do in the Asian market what Carsales.Com Ltd (ASX: CAR) has done so successfully in Australia. Unfortunately, though things are not quite going to plan at the minute, with its interim results revealing revenue of just $3.2 million and expenses of $9.1 million. As you might expect this caused investors to exit in their droves, cutting its share price down by 65% in the last three months. Despite how cheap it may now appear, I personally would prefer to wait for a marked improvement in its performance before making an investment in the company.
Medibank Private Ltd (ASX: MPL)
The shares of private health insurance provider Medibank have now dropped 18% in the last three months. Not only does this mean its shares are expected to provide a fully franked 4.7% dividend in FY 2017, but it also puts them at a significant discount to rival NIB Holdings Limited (ASX: NHF). NIB's shares are currently changing hands at 19x estimated full year earnings. So at just 16x estimated full year earnings, I believe Medibank is the better option in the industry and at an attractive level to make an investment today.
