Welcome to Friday afternoon, Foolish readers. After another turbulent day of trading, the S&P/ASX 200 (INDEXASX: ^AXJO) (ASX: XJO) is down 0.9% to 4,777 points. This takes its total losses for the week to just under 4% in total.
As ever, a number of shares considerably underperformed the market, and here’s why:
Ausdrill Limited (ASX: ASL) slumped 4.5% to $0.21 today, undoing gains made in trade yesterday as investor uncertainty about the global commodity environment persists. With the fall in commodity prices and capital expenditure in Australia, Ausdrill has been diversifying geographically, most recently winning contracts for a joint venture in Africa. Ausdrill also recently purchased $1 million worth of shares in Titan Energy Services Ltd (ASX: TTN) as that company urgently raised capital.
Ausdrill shares are down 49% in the past twelve months.
Rent.com.au Ltd (ASX: RNT) fell 2.6% to $0.185, and shares now trade below their issue price despite recent strong progress towards the company’s goals of lifting website views and growing the number of listings. Rent.com.au is now the 7th largest property website in Australia, according to AC Nielsen’s national rankings. However, it seems shareholders are concerned about the company’s cash flows, which are not good. Despite recently raising $3.7m in capital, Rent.com.au appears to have around 9 months of operations remaining at its most recent cash burn rate, suggesting another capital raising is just around the corner.
Fortescue Metals Group Limited (ASX: FMG) lost 4.4% to $1.625 as continued uncertainty around the iron ore market and the value of Fortescue’s shares persists. Fortescue has beaten expectations when it comes to improving its operations, absolutely slashing its costs of production whilst also paying down significant debt. The company labours under US$6.1 billion of net debt (inclusive of US$2.3bn cash) as of 31 December 2015, but it has several years to reduce the burden with its first debt repayment due in 2019.
Fortescue shares are down 39% in the past twelve months.
Lifehealthcare Group Ltd (ASX: LHC) crashed 8% to $2.20 as investor fears over the company’s vulnerability to changes in the healthcare sector really gather steam. Shareholders are worried that sales of the company’s high-margin devices like prosthetics could come under pressure, after recent comments in the media ridiculed the cost of prosthetic and other medical implant devices. (Readers can find an Australian Financial Review version of that story here). Since Lifehealthcare has been focussing on improving earnings by lifting sales of high-margin devices, the company’s earnings are seen as being under threat by potential regulatory changes to this area.
Lifehealthcare shares are down 19% in the past twelve months.
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Motley Fool contributor Sean O'Neill owns shares of LifeHealthcare Group Limited. 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.