Over the last 12 months the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has managed to put on a gain of approximately 7.4%.
During the same period, three shares in particular have made notably sharp declines. Are they cheap enough to buy now?
The Accent Group Ltd (ASX: AX1) share price has lost 35% of its value over the last 12 months. General weakness in the retail industry and concerns over Amazon's arrival appear to have weighed on the footwear retailer previously known as RCG Corporation. Although I do think Amazon could be a threat, I believe the strength of its licensed brands should offer it some protection from the retail behemoth. While I think Accent could be a great investment, investors may want to wait for its earnings release next month. This should provide a bit more colour on how its business is tracking.
The Baby Bunting Group Ltd (ASX: BBN) share price is down 35% since this time last year. Investors headed to the exits after the company warned that profits would be flat this year after clearance sales from closing competitors weighed heavily on its performance. But the good news is that this headwind should only be short term and Baby Bunting is likely to come out of its stronger and in a position to win a greater slice of the market. In light of this, I continue to believe that it would be a great option for investors. Especially as its shares provide a trailing fully franked 4.6% dividend.
The Retail Food Group Limited (ASX: RFG) share price has tumbled 69% during the last 12 months. Negative media coverage has hit investor sentiment recently, as has the food and beverage company's surprise profit downgrade. Whilst there is little doubt that its shares are dirt cheap based on its trailing earnings, I believe there is a danger that it could be a value trap. In light of this, I would stay well clear of Retail Food Group for the time being. After all, I suspect the company may find new franchise sales and renewals hard to come by following the negative media coverage. This could lead to a significant reduction in its store network and overall profitability.
