It was a disappointing start to the week for the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO). It finished the day 0.6% lower at 5,904.9 points.
With the market falling heavily it will come as no surprise to learn that several shares have fallen to 52-week lows or worse. Is this a buying opportunity?
The Adelaide Brighton Ltd (ASX: ABC) share price fell to a 52-week low of $5.68 on Monday. Although the building materials company delivered a solid half-year result in August, investors have been hitting the sell button in a hurry after its guidance for the full-year fell short of expectations. Another cause for concern has been the retirement of both its CEO and CFO. While I think its shares are starting to look reasonably priced, I’d prefer to get in at a cheaper price due to its lower growth expectations.
The Ansell Limited (ASX: ANN) share price hit a 52-week low of $22.36 today. The health and safety products company’s shares have come under pressure this year after it posted a 13.7% decline in earnings before interest and tax from continued operations in FY 2019. Last week Ansell held its annual general meeting and appeared downbeat on FY 2019. It warned that “the company faces the impact of the well‐publicised uncertainties that currently confront the world and its various economies.” It also advised that the first quarter of the new financial year has seen weaker demand in EMEA, primarily related to slowing automotive production. Some emerging markets have also been affected by renewed economic uncertainty. I think Ansell could struggle over the next couple of years and would suggest investors stay away for the time being.
The Think Childcare Ltd (ASX: TNK) share price dropped to a two and a half year low of $1.20 on Monday. Investors have been heading to the exits in their droves due to the impact that an oversupply of childcare centres has had on its performance and prospects. Unfortunately, I don’t think trading conditions are going to improve any time soon, which is likely to be bad news for the shares of Think Childcare and G8 Education Ltd (ASX: GEM). The latter’s shares are trading within sight of their 52-week low as well.
You might not know this market leader's name, but it's rapidly expanding into a highly profitable niche market here in Australia. Even better, the shares boast a strong, fully franked dividend that should balloon in the years to come. In other words, we're looking at the holy grail of incredible long-term growth potential AND income you can watch accruing in your account in real time!
Simply click here to grab your FREE copy of this up-to-the-minute research report on our #1 dividend share recommendation now.
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Ansell Ltd. 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.