Why Slater & Gordon Limited’s share price collapsed 53% today

If you own shares of Slater & Gordon Limited (ASX: SGH), I urge you to look away now.

Shares of the legal eagle were trading roughly 8% lower shortly before noon, before getting absolutely poleaxed.

They fell more than 53% to just 90 cents and have fallen 71.6% over the last week, down from $3.17 per share.

Source: Google Finance

Source: Google Finance

Today’s share price collapse followed a market-sensitive announcement regarding proposed changes by the UK Government which, if implemented, would impact on the rights of people injured in road traffic accidents.

Slater & Gordon doesn’t expect the changes to impact its earnings guidance for this year, but it very well could in the future.

Fellow law firm Shine Corporate Ltd (ASX: SGH) has also fallen more than 6% for the day.

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Motley Fool contributor Ryan Newman 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. You can follow Ryan on Twitter @ASXvalueinvest.

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.

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