Yesterday I talked about a number of shares which had just stormed to new 52-week highs.
Unfortunately not all shares have fared as well during the last 12 months, with some even falling to the dreaded 52-week low. Will they bounce back?
The Covata Ltd (ASX: CVT) share price fell to a 52-week low of 2.9 cents yesterday. This latest decline means the security solutions provider’s shares have now lost a whopping 88.4% of their value in the last 12 months. Whilst I think data security is an important and potentially lucrative market, the company has so far failed to make a meaningful impact in the industry. So much so, during the last quarter the company had cash receipts of just $45,000, with cash outflows of $3.4 million. Whilst it is working on reducing its cash burn and updating its product range, I would suggest investors give Covata a miss.
The Quintis Ltd (ASX: QIN) share price dropped to a multi-year low of 36 cents on Thursday. This embattled sandalwood plantation manager’s shares fell sharply earlier this year when a US-based research firm compared its business model to a Ponzi-scheme and said its shares were worthless. Quintis’ shares then tumbled even further this week when management revealed that they had only just become aware that a major supply agreement with Galderma had been cancelled in December. Avoid Quintis at all costs would be my advice.
The Vita Group Limited (ASX: VTG) share price hit a 52-week low of $1.45 yesterday after the retailer announced that it was working with Telstra Corporation Ltd (ASX: TLS) on remuneration and other commercial terms to deal with “the challenges that lie ahead.” Vita Group currently operates 107 Telstra retail stores, but there are concerns that it could lose a portion of these as Telstra reorganises its store network into clusters. While this sell-off could prove to be a huge overreaction and an opportunity to buy shares on the cheap, I would hold off an investment until things become clearer.
Instead of investing in the aforementioned beaten down shares, I would suggest investors look at these high-flying growth shares which have the wind in their sails.
For many, blue chip stocks means stability, profitability and regular dividends, often fully franked..
But knowing which blue chips to buy, and when, can be fraught with danger.
The Motley Fool’s in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool’s Top 3 Blue Chip Stocks for 2017."
Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.
If you’re expecting to see the likes of Commonwealth Bank, Telstra and Wesfarmers shares on this list, you’ll be sorely disappointed. Not only are their dividends growing at a snail’s pace, their profits are under pressure too due to the increasing competitive environment.
The contrast to these “new breed” blue chips couldn’t be greater… especially the very real prospect of significant share price gains, something that’s looking less likely from the usual blue chip suspects.
The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies moves – we may be forced to remove this report.
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The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Telstra Limited. Motley Fool contributor James Mickleboro 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.