With the overall market taking its third consecutive tumble, it’s no surprise that several stocks are being hammered today. In mid-afternoon trading, the ALL ORDINARIES (Index: ^AORD) (ASX: XAO) is down 1.2% at 5,745.90.
The All Ords index contains around 500 of Australia’s largest stocks and is the ASX’s largest index by number of stocks.
Here’s our view on six stocks that have dropped dramatically today…
Amcom Telecommunications Ltd (ASX: AMM) has dropped 14.4% to $2.31, after TPG Telecom Limited (ASX: TPM) announced that it had increased its shareholding to 17% and intends to block the merger between Amcom and Vocus Communications Ltd (ASX: VOC). There’s still some way to go here, with Vocus referring TPG’s move to the Competition Commission (ACCC). Colleague Ryan Newman covered the development in more detail here.
Iron ore miners Fortescue Metals Group Limited (ASX: FMG) and BC Iron Limited (ASX: BCI) have dropped 9.9% and 7.8% respectively, after the iron ore price fell 4.6% to US$57.13 a tonne overnight. Investors may have been hoping the recent 20% run up in the commodity price would continue, but where it goes from here is anyone’s guess.
Seven West Media Ltd (ASX: SWM) has fallen 6.8% to $1.268, after coming out of a trading halt in which the TV broadcaster raised $150 million in a placement to institutional investors at $1.25 per share. Seven is now embarking on the next leg, attempting to raise $238 million from retail investors. Clearly, the dilution and issue of shares at a discount has weighed on the share price.
Recall Holdings Ltd (ASX: REC) has dropped 6.4% to $7.15. That’s perhaps surprising, given the company has received a takeover offer from Iron Mountain valued at $8.50 per share – a significant premium to today’s price. Unfortunately for shareholders, the cash pool is limited to a maximum of $225 million – about 10% of Recall’s market cap. With Iron Mountain’s shares falling 5% yesterday, most Recall shareholders will receive 0.1722 Iron Mountain shares instead of cash.
Cloud accounting firm XERO FPO NZ (ASX: XRO) has dropped 6.4% to $18.75 and has now lost 19% in the past week. Are institutional investors dumping Xero to invest in the upcoming listing of rival MYOB Group Limited? Are they backing the wrong horse? Colleague Sean O’Neill thinks so.