Due to sizeable declines in their respective share prices, a number of ASX shares appear to be changing hands at very cheap prices at the moment.
However, although these shares look cheap, it doesn't necessarily mean that all of them are good value. Here's why I wouldn't be in a rush to buy these two:
iSentia Group Ltd (ASX: ISD)
It wasn't that long ago that iSentia was a market darling and could do no wrong. But that all changed in FY 2017 when the media monitoring company looked to expand its business into the growing content marketing industry. The acquisition of King Content was nothing short of a disaster and things have gone downhill since then. This includes its share price which has fallen over 50% in the last 12 months.
Although the King Content business has now been disbanded, the company's core business has begun to struggle due to revenue pressures from higher levels of customer churn. In light of this, EBITDA is expected to decline 22% in FY 2018. This will be the second year in a row of such declines after EBITDA sank 21% lower in FY 2017.
Myer Holdings Ltd (ASX: MYR)
The Myer share price has lost 52% of its value over the last 12 months after its multi-year turnaround plan failed to make any noticeable difference to its disastrous performance. Unfortunately, I don't believe the plan will ultimately lead to much of an improvement due to the lack of relevance the retailer has with consumers these days.
Department stores are arguably a relic of a previous retail age and have been replaced with shopping centres and online retail stores like Amazon and Kogan.com Ltd (ASX: KGN). So although Myer's shares look cheap at under 8x trailing earnings, I wouldn't risk buying the shares of a retailer that may not exist in a few years.
