The local market has had a disappointing start to the week and in late morning trade every single sector is currently in the red.
This selling pressure has led to several shares falling to 52-week lows. Three that reached this unwanted milestone today are listed below, is this a buying opportunity?
The CSR Limited (ASX: CSR) share price tumbled to a 52-week low of $3.23 this morning. Last week the building supplies company released its half year results and reported a 31.9% decline in net profit after tax to $94 million. The weaker-than-expected result was caused by a lower contribution from its Property business due to delays in the timing of the Horsley Park site sale. This sale is now expected to occur in the second half. While the first half performance was a disappointment, it was largely down to timings. So, with management confident in achieving a full year profit in the range of $180 million to $205 million, it could be worth taking a look at CSR.
The Marley Spoon AG (ASX: MMM) share price dropped to a new 52-week low of 75.5 cents on Monday. Unfortunately, this latest decline means that the subscription-based meal kit provider’s shares have almost halved in value since listing on the ASX at $1.42 in July. Investors appear to have been disappointed that the company downgraded its earnings guidance for calendar year 2018 in its latest quarterly update. According to the release, although it held firm with its revenue guidance, increased investment in marketing means the company expects to make a loss before interest and tax of between €32 million and €34 million. Previously a loss before interest and tax of €25 million was expected. While I like the company’s service, I’m yet to be convinced that there’s an investment opportunity here.
The Reject Shop Ltd (ASX: TRS) share price continued its decline on Monday and fell to a decade-low of $2.09. The discount retailer’s shares have fallen 57% since this time last month following the release of a disappointing trading update. That update revealed the retailer has suffered from a sudden deterioration in its same store sales due to the lack of real wage growth and increases in basic living expenses. As a result of this decline in same stores sales, management downgraded its earnings guidance for the first half by around 40%. While this has left them trading at a level that looks dirt cheap, I’d suggest investors wait for signs of improvement before considering an investment.
5 stocks under $5
We hear it over and over from investors, "I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I'd be sitting on a gold mine!" And it's true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
*Extreme Opportunities returns as of June 5th 2020
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended The Reject Shop 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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