Can 2015’s worst performers come good in 2016?

2015 was a horror year for some companies, with several losing more than two-thirds of their share price value and plenty of ASX shares falling 50%.

Among the worst were Bradken Limited (ASX: BKN) – down 90%, Slater & Gordon Limited (ASX: SGH) – down 89%, MMA Offshore Ltd (ASX: MRM) ex-Mermaid Marine – down 79% and Liquefied Natural Gas Ltd (ASX: LNG) down 71%.

Among the large caps, Origin Energy Ltd (ASX: ORG) and Santos Ltd (ASX: STO) both fell around 60%, following a global crash in oil prices.

Company Fall
Bradken -90%
Slater & Gordon -89%
MMA Offshore -79%
Liquefied Natural Gas -71%
Santos -60%
Origin Energy -63%

Source: CapitalIQ

Mining equipment producer Bradken has been hit by falling mining investment which has negatively impacted revenues and earnings. With mining investment not predicted to hit bottom until 2017, Bradken appears to have another year of pain ahead of it, unless it can garner a takeover offer, with a number of potential acquirers circling the company over the past few years.

Lawyers Slater & Gordon have faced a number of issues, including questions from regulators over accounting practices and concerns over its UK acquisition of part of the Quindell business. In a large slice of irony, the law firm could even face a class action, after abandoning its earnings guidance in late 2015. 2016 could be the defining year for S&G, either seeing it regain its former market darling status or potentially falling into voluntary administration after taking on hundreds of millions of debt.

MMA Offshore has been hit by falling oil prices, as the company provides fleet support and services to oil rigs and companies conducting offshore drilling. Falling oil prices mean oil and gas companies have drastically cut capital expenditure and renegotiated contracts with suppliers, and the company is struggling to keep its fleet fully utilised. With oil prices likely to stay low again in 2016, there’s no pot of gold at the end of the 2016 rainbow for MMA Offshore.

Liquefied Natural Gas Ltd (LNGL) also faces the prospect of lower oil and gas prices in 2016 negatively affecting its business, so a recovery in its share price appears unlikely. Santos and Origin Energy are in the same boat – so to speak.

Foolish takeaway

It appears that factors affecting 2015’s worst performers will continue throughout 2016, and only an exceptional event is likely to see them recover some of the share price falls of last year. Foolish investors may want to continue steering clear.

Don't miss your chance to "invest like a Pro"...

Motley Fool Pro -- our most comprehensive and innovative ASX investment service -- will reopen for a brief time, to accept new members. That means you've got the chance to follow along as one top investor puts $1,000,000 of The Motley Fool's own money to work...all in ASX stocks. And you're invited to watch everything that goes into our decision -- 100% FREE! We've dubbed this innovative project, Motley Fool Pro. Click here to step inside for an exclusive look around - it's FREE!

Motley Fool writer/analyst Mike King doesn't own shares in any companies mentioned. You can follow Mike on Twitter @TMFKinga

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. 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.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.