Are these beaten down shares in the bargain bin?

Over the last 12 months the benchmark S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has managed to fight through the volatility and carve out a gain of over 4% excluding dividends.

During this time not all shares on the local share market have pushed higher. In fact, some shares have been thoroughly beaten down.

Myer Holdings Ltd (ASX: MYR) and Retail Food Group Limited (ASX: RFG) have easily been the worst performers on the index with 79% and 63% declines, respectively.

While those two shares are certainly on my sell list, two other shares that have been beaten down could be worth a closer look. Are they in the bargain bin now?

The Greencross Limited (ASX: GXL) share price has fallen 22% since this time last year. This integrated pet care company appears to have first come under pressure when speculation of Amazon’s arrival in Australia emerged and has never fully recovered. Whilst Amazon is a threat, I believe the company’s roll out of veterinary clinics within its retail stores is a great move and should insulate it somewhat from the retail behemoth. So far things have gone extremely well with the strategy, with the company recently reporting first-half like-for-like sales growth of 7.5% in retail stores that already have in-store clinics inside them. I think Greencross could be a buy at this price.

The Super Retail Group Ltd (ASX: SUL) share price is down 39% over the last 12 months. Like Greencross, I suspect the arrival of Amazon has weighed heavily on investors sentiment of late. As has the underperformance of its Leisure segment. Rather than offloading the segment as many had hoped, management opted to add to it through the acquisition of Macpac last month. This is certainly a bold move by management and could potentially come back to haunt them if the acquisition fails to improve the segment’s performance. I’m not a buyer of its shares until I have seen signs of improvement, but I suspect it will prove to be dirt cheap if the acquisition is a success.

Lastly, these top shares have been flying higher and higher again this year. Despite the strong gains they have made, I still believe they are great value.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Greencross Limited. The Motley Fool Australia owns shares of Super Retail Group Limited. 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 Scott Phillips.

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