Following on from my earlier piece about how MMJ Phytotech Ltd (ASX: MMJ) and three other shares had just hit 52-week highs, I thought I would take a look at three unfortunate shares that have just made new 52-week lows.
Are they bargain buys or best avoided?
The RCG Corporation Ltd (ASX: RCG) share price has tumbled to a new 52-week low of $1.09 today. The shares of the company behind retail brands such as Athlete's Foot and Hype DC have now fallen almost 27% since the turn of the year. The reason for the decline was a disappointing start to the second-half which meant the company had to cut its full-year guidance. At 15x trailing earnings and providing a fully franked 5.5% dividend, I think RCG could be worth a closer look at the current price.
The Shine Corporate Ltd (ASX: SHJ) share price has fallen to a new 52-week low of 55.5 cents today. This means the legal services provider's shares have now dropped as much as 57% in the last six months. News that state governments plan to crack-down on fraudulent third-party insurance claims has been the catalyst for the plunge. Although at a little over 4x trailing earnings its shares look dirt cheap, I expect there could be a serious drop in profitability that justifies the low multiple. I would avoid this one for the time being.
The Vicinity Centres Re Ltd (ASX: VCX) share price has dropped to a 52-week low of $2.69. This real estate investment trust is focused on the retail industry and owns stakes in shopping centres such as Chatswood Chase Sydney, Chadstone Shopping Centre, and the DFO in Essendon. Despite the drop, its shares are still changing hands at 18x trailing earnings. Considering its weak half-year result and outlook I think this is a touch expensive and would suggest investors stay clear of this one.
