Although the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has dropped lower today, it is still up a solid 10% since this time last year.
Unfortunately, not all shares have been able to follow the market higher during this time. The three shares listed below, for example, have each lost over half their value during the last 12 months.
Are they in the bargain bin now?
The PMP Limited (ASX: PMP) share price has shed over 69% of its value over the last 12 months. The commercial printer’s shares have been heavily sold off this year after it downgraded its EBITDA guidance twice. The company had originally guided to EBITDA in the range of $70 million to $75 million before revising it lower to the range of $50 million to $55 million. This was then revised all the way down to between $40 million and $45 million. With earnings season approaching fast, it is starting to look like the company may deliver on its final guidance. However, I wouldn’t be in a rush to invest as I’m not convinced FY 2019 will see any growth in earnings.
The Retail Food Group Limited (ASX: RFG) share price has lost an incredible 90% of its value since this time last year. Investors have been heading to the exits in their droves after the embattled food and beverage company was accused of treating franchisees unfairly. The concern is that this will lead to lower franchise sales and an increase in non-renewals from existing franchisees. This could mean that its store network dwindles over the coming years, leading to lower and lower profits. Considering the company has significant debt, this could mean its future is hanging in the balance. As a result, I would stay well clear of the company’s shares.
The Village Roadshow Ltd (ASX: VRL) share price is down almost 53% over the last 12 months. The entertainment company has been suffering from weakness in both its Cinema and Theme Parks businesses. In addition to this, Village Roadshow recently raised $51 million at a meaningful discount to its then share price. These funds will be used to pay down its debt. While I’m not convinced that the worst is over just yet, I do think the company is starting to look attractive at this level with its lower debt load.
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Motley Fool contributor James Mickleboro 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.