Why these 4 shares are sinking today

The S&P/ASX 200 (Index: ^AXJO) (ASX:XJO) has drifted 0.2% lower today, but some of the biggest losers include FlexiGroup Limited (ASX:FXL) and ALS Ltd (ASX:ALQ).

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With both the UK and US markets closed overnight due to public holidays, the S&P/ASX 200 (Index: ^AXJO) (ASX:XJO) was always going to struggle for direction today and investors have seen the index trade around 0.2% lower to 5398 points.

Despite the broader market being fairly subdued, a number of stocks have had a very rough day including:

FlexiGroup Limited (ASX: FXL)

FlexiGroup is the worst performing stock in the ASX200 index today with its shares falling more than 8.5% to $2.02. The sharp fall comes after the financial services company announced it would be taking a $42.8 million hit to its bottom line in FY16 as a result of several non-cash write-offs and adjustments. Although the company highlighted that its FY16 dividend will be 50%–60% of cash NPAT (forecast to be $97 million), not statutory NPAT ($54.2 million), investors were clearly unimpressed with the company’s overall guidance. The company did lay out a plan to return to double-digit earnings growth in FY18, but investors should expect to see profit growth of less than 10% in FY17.

Shares of FlexiGroup have fallen nearly 44% over the past 12 months.


After a shocking day yesterday, shares of ALS are again under pressure today falling around 3% to $4 a share. The company reported a full year statutory loss of $241 million recently – mainly as a result of weakness in its energy and mineral testing segments. Despite yesterday’s sharp decline, Morgan Stanley has moved to downgrade the stock and this could be part of the reason behind today’s poor share price performance. It would not be surprising to see more analysts downgrade the stock over the next little period especially if commodity and energy prices remain depressed.

Shares of ALS have fallen by more than 34% over the past 12 months.

Flight Centre Travel Group Ltd (ASX: FLT)

Flight Centre shares are under pressure again today and have fallen around 2.2% to $31.55. Today’s fall could be the result of short term investors exiting the stock after expecting the shares to rebound following last week’s profit downgrade and subsequent sell-off. Since that has not occurred,  some traders may be looking for an alternative trade elsewhere. Interestingly, other shares in the travel sector such as Qantas Airways Limited (ASX: QAN), Auckland International Airport Ltd (ASX: AIA) and Sydney Airport Holdings Ltd (ASX: SYD) are also under heavy selling pressure today.

Shares of Flight Centre have fallen 32% over the past 12 months.

Virtus Health Ltd (ASX: VRT)

Shares of Virtus Health opened sharply lower today but have clawed back some of their losses to trade around 1% lower to $7.05. Shares of fellow IVF services provider, Monash IVF Group Ltd (ASX: MVF) are also around 2% lower today, after investors reacted to last night’s airing of the ABC’s Four Corners program which painted the whole industry in a fairly negative fashion. The program claimed that IVF service providers were misleading patients in regards to potential success rates and were seeking to ‘upsell’ products that had no clinical benefit. Despite the story being mostly one-sided, some investors may be concerned this could have the potential to impact future revenues.

Shares of Virtus Health have fallen around 9% over the past 12 months.

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Motley Fool contributor Christopher Georges has no position in any stocks mentioned. 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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