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Dick Smith share price crashes – down 47%

Dick Smith Holdings Ltd (ASX: DSH) has seen its share price plunge 54% earlier this morning after announcing a writedown on its inventory of $60 million pre-tax. The company also says it is unable to re-affirm its profit guidance previously provided.

Shareholders might want to look away now.

Dick Smith share price chart

Source: Yahoo!AU Finance

Back in October, we warned about having all your eggs in one basket and understanding the risks you are taking on. That’s something Slater & Gordon Limited (ASX: SGH) and now Dick Smith shareholders have recently found out.

Dick Smith’s share price has since recovered somewhat, to be down just 47%.

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Motley Fool contributor Mike King 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 Mike on Twitter @TMFKinga

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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