Unfortunately for its shareholders, the Bellamy's Australia Ltd (ASX: BAL) share price was one of the worst performers on the All Ordinaries (Index: ^AXAO) (ASX: XAO) during trade on Friday.
The infant formula company's shares finished the day down 5.5% to $13.67, meaning its shares are down around 8% since the start of the month.
What happened?
With no news out of the company, today's gain is likely to be due to investors selling down shares trading on higher than average earnings multiples. Industry peer Blackmores Limited (ASX: BKL) was also impacted and fell 4%.
Bond yields have been widening in the United States over the last few days due to forecasts for quicker-than-expected interest rate hikes by the Federal Reserve.
As risk-free treasury bonds are included as part of many valuation models, their widening increases the excess return required on equity investments, lowering the multiple that investors are willing to pay to own shares.
Investors may want to look out for broker notes in the next few weeks to see if price targets have been adjusted accordingly.
