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Why the InvoCare Limited share price just hit a 52-week low

The InvoCare Limited (ASX: IVC) share price hit a 52-week low today and has lost around 33% of its value since hitting highs close to $18 just back in November 2017. The company behind the White Lady and Simplicity Funerals brands has reportedly seen its share price falls due to investor fears over rising competition that may force it to reduce prices.

In the United Kingdom for example it is being reported that established funeral operators in the Invocare mould are being hit by cut-price online only competition.

InvoCare shares also changed hands on a high multiple of past profits until recently, with the single-digit growth in sales and operating EBITDA over 2017 (InvoCare reports on a calendar year basis) insufficient to stop investors hitting the sell button.

In 2017 it reported operating earnings after tax of $63.5 million on total sales of $470.9 million. The group offers a trailing yield of 3.7% based on total dividends of 18 cents per share over 2017.

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Motley Fool contributor Tom Richardson has no position in any of the 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 Scott Phillips.

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