Following yesterday's strong start to the week, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has continued to climb higher today. The index edged up by around 0.5% to 5,385 points before dropping back a touch in the afternoon, with the energy and materials sectors doing a lot of the heavy lifting once again.
Although the index is higher these shares have been crashing lower. Here's why:
AIR N.Z. FPO NZ (ASX: AIZ) shares hit a bit of turbulence today, dropping over 4% to $2.01. Today's drop came despite no news being released to the market. But with the Air New Zealand share price dropping by over 22% in the last 12 months, there could be some tax-loss selling going on here. This means the shares are now trading at 4x estimated FY 2016 earnings. Whilst this looks cheap on paper, lower demand and rising oil prices may make these estimates hard to achieve. I would approach this stock with caution.
Air New Zealand's share price has dropped almost 9% in the last 30 days.
Estia Health Ltd (ASX: EHE) shareholders are not having a great day. The share price of the developer and operator of residential aged care facilities has dropped 7% today to $4.91. Today's decline appears to be related to reports in The Australian claiming the Department of Health is set to audit Estia Health. This is due to concerns about the company's practice of reclassifying residents of newly purchased facilities into higher care categories, which attracts extra government funding.
Estia Health shareholders have had a terrible 2016, with the share price declining by 34% year-to-date.
Greencross Limited (ASX: GXL) shares have plummeted by close to 8% to $7.35 today. The decline comes on the back of reports of a block sale of the integrated pet-care business shares. It is understood that Credit Suisse won a pitching contest for $80 million worth of the company's shares at $7.30 each from private equity firms TPG and The Carlyle Group. Further details on this story can be found here.
Greencross shares are still up by over 10% this year, despite today's declines.
UGL Limited (ASX: UGL) shares are down for a second day running, this time by over 5% to $2.17. Shares of the engineering and services company dropped 33% yesterday after it warned of contract losses up to the value of $200 million from its Inpex Ichthys LNG project. In my opinion, investors looking for exposure to the industry might be better of taking a look at Liquefied Natural Gas Ltd (ASX: LNG) instead. Its shares have climbed by over 30% this week alone, and in my opinion looks better positioned to profit on the increased demand for LNG.
UGL shares have erased strong gains made earlier this year, and are now trading down by 12% for the year.
