In afternoon trade the benchmark S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has built on last week’s gains and is notably higher. At the time of writing the benchmark index is up 0.3% to 5,887 points.
Four shares that have failed to follow the market higher today are listed below. Here’s why they have started the week in the red:
The G8 Education Ltd (ASX: GEM) share price has fallen a further 4.5% to $2.20. The childcare operator’s shares came under heavy selling pressure on Friday after it warned that centre supply growth has continued to outstrip demand growth and led to falling occupancy levels. Analysts on the equities desk at Macquarie slashed their price target on G8’s shares from $3.30 to $2.65 in response to the news.
The Galaxy Resources Limited (ASX: GXY) share price has fallen 5% to $2.87 after the lithium miner released a weaker than expected quarterly update. One thing that caught my eye was a 10% decline in the average lithium price during the quarter. While this was blamed on an expected seasonal decline and Galaxy’s prices are locked in for 2018, it is worrying given how the outlook for lithium prices has turned in recent months. I intend to take a closer look at the result and consider my position in the company in the coming days.
The iSelect Ltd (ASX: ISU) share price has plunged 52% lower to 48 cents after the price comparison company provided another underwhelming trading update. According to the release, trading through the last two weeks of March and the first three weeks of April were below expectations and have resulted in an earnings downgrade. Instead of underlying EBIT of between $26 million to $29 million, management expects to achieve EBIT of just $8 million to $12 million. Unsurprisingly, its CEO has handed in his resignation this morning.
The LiveHire Ltd (ASX: LVH) share price has crashed 15% lower to 65 cents after the talent technology company provided its latest quarterly update. That update revealed a surprise quarter-on-quarter decline in cash receipts. While management has blamed this on the timing of payment cycles and the migration of some existing clients to upfront 12-month contracts, companies that trade on such nosebleed valuations can’t afford blips like this. I would stay clear of LiveHire until its cash receipts justify its market capitalisation.
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Motley Fool contributor James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia has recommended G8 Education 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.