Welcome to the last day of 2015, Foolish readers. The S&P/ASX 200 (INDEXASX: ^AXJO)(ASX:XJO) finished flat for the year, and these four companies fell even further today.
Here's why:
Kina Securities Ltd (ASX: KSL) lost 5% to $1.09 in continuing volatility as investors are uncertain what to make of this recently listed, purely Papua New Guinean-focussed stockbroker, lender, and wealth manager. While Kina does carry additional sovereign and currency risks compared to local businesses, it also operates in a market growing more rapidly than the Australian one.
Kina further has a Tier One capital adequacy ratio of 31% (regulatory minimum 8%) and earns a net interest margin of 8% on its loans. These attributes are significantly higher than those enjoyed by Australian market-leader Commonwealth Bank of Australia (ASX: CBA), for example, and are enough to make Kina worthy of closer investigation.
Australian Dairy Farms Group (ASX: AHF) crashed 21% to $0.355 in what represents possible profit taking after yesterday's 67% increase. Other dairy producers – who are in vogue right now because of the attractiveness of their target Chinese market – also fell in today's trade, making profit taking look like a distinct possibility. Investors should remain cautious about how much potential growth the market is factoring in to these companies, before buying when prices have been soaring.
Slater & Gordon Limited (ASX:SGH) shares fell 3.5% to $0.83 as investors continue to weigh up the implications of management's recent withdrawal of profit guidance as well as an ongoing ASIC investigation and potential regulatory changes in the UK. I wrote an article on the company – scheduling for publishing on Sunday – containing links to our earlier coverage of the company through the past six months, which may prove a useful starting point for readers looking to learn more.
EVOLUTION FPO (ASX: FPO) lost 4.5% today after the value of gold slumped overnight, although shares remain up 130% for the year. Shares in other gold miners like Western Areas Ltd (ASX: WSA) and Alacer Gold Corp – CDI (ASX: AQG) also fell on the news. Gold remains a contentious investment idea as some argue rising US interest rates increase the appeal of investments other than gold – thus reducing the appeal of (and demand for) gold.
