Share markets look like putting in a poor finish to 2018 that could see major global indices including the S&P / ASX200 finish at levels lower than where they started the year. However, there are some popular growth shares on the ASX that have been absolutely hammered over 2018. This leaves the question as to whether these shares are now in the bargain bin or ready to fall further on the back of bad news or turning market sentiment. So let’s take a look at 3 growth shares that are now at 52-week lows. The Ainsworth Game Technology Limited (ASX:…
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Share markets look like putting in a poor finish to 2018 that could see major global indices including the S&P / ASX200 finish at levels lower than where they started the year. However, there are some popular growth shares on the ASX that have been absolutely hammered over 2018.
This leaves the question as to whether these shares are now in the bargain bin or ready to fall further on the back of bad news or turning market sentiment. So let’s take a look at 3 growth shares that are now at 52-week lows.
The Ainsworth Game Technology Limited (ASX: AGI) share price hit a 52-week low of 80 cents today and is now down 63% in 2018. This shocking return from a former ‘market darling’ is due in part to a November 23 update where the pokie machine manufacturer told investors to expect profit before tax of $8 million for the six months ending December 31 2018, compared to $11.3 million in the prior corresponding half-year period. However, the group is forecasting second half profit to be up “at least” 75% on the $8 million expected in the first half.
The big profit fall is being blamed on increased competition in Australia, increased investment in research and development, and timing issues around the launch of new products. In FY 2018 the group earned 9 cents per share, but given the profit warning for the first half this amount could be lower in FY 2019. Therefore whether the stock is cheap or not depends over the short term on whether the group can deliver on guidance for a far stronger six-month period to June 30, 2019.
The oOhMedia Ltd (ASX: OML) share price is down 3.4% to $3.95 today and down 26% from highs hit in August 2018. In FY 2018 oOhMedia reported a net profit of $9.2 million on revenue of $192 million, with dividends of 3.5 cents per share on 5.6 cents in earnings per share. In the new financial year oOhMedia has also completed the $570 million acquisition of outdoor advertising rival Adshel. Given the steep discount in valuation since August on the back of no material news the shares will start to look more attractive to some.
The Integrated Research Limited (ASX: IRI) share price is down 4.5% to $1.89 today and has now lost more than half its value through 2018. On November 20 the technology provider announced the unexpected resignation of its CEO, John Merakovsky, with no replacement announced as yet. The group delivered a flat profit result in FY 2018, but still looks well positioned for medium-term growth. It now has 88% of its revenues as recurring and a sticky blue-chip client base. Again, the steep price falls mean this business could be worthy of close investor attention.
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Motley Fool contributor Yulia Mosaleva has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Integrated Research Limited and oOh!Media 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.