After a horror week last week, things could have turned around for the Slater & Gordon Limited (ASX: SGH) share price. Shares went as low as $0.61 in trade on Friday morning, roughly a 70% loss for the week.
However, a management announcement this morning confirming the company's guidance and outlining the potential impacts seems to have reassured shareholders, who piled back into the stock.
Over 25 million shares (over 7% of the total float) have traded hands, and the stock is selling for close to $1 at the time of writing – after just one hour of trading.
The cruel nature of mathematics, however, means that shares are still substantially below the $2 they sold for at the same time last week.
Whether Slater & Gordon shares will continue to appreciate in value further is unknown, although given that they trade on a Price to Earnings (P/E) ratio in the low-single digits (ASX average is ~14) it seems certain that their worth will continue to be hotly debated amongst investors.
I'm not a buyer at today's prices (or last week's, for that matter) as I feel a significant amount of uncertainty remains around the company's future earnings potential in the UK, despite today's update.
Investors who love a legal eagle might want to look around at Shine Corporate Ltd (ASX: SHJ). Its shares are also rising strongly today, but are still down some 7% compared to last week, when they started sinking in sympathy with Slater & Gordon.
