We may only be a little over two weeks into 2019, but there have already been a number of big movers on the benchmark S&P/ASX 200 (Index: ^AXJO) (ASX: XJO).
Three of the worst performers so far this year are listed below. Are they cheap enough to buy today?
The Costa Group Holdings Ltd (ASX: CGC) share price has fallen 32% since the start of the year. Investors have been hitting the sell button in a hurry after the horticulture company’s trading update last week revealed a sudden fall in demand for its tomatoes, berries, and avocados in December. Unfortunately, demand remains subdued this month, leading management to warn that earnings for the 12 months to June 2019 could be flat if things don’t pick up. It has previously provided guidance for low double-digit earnings growth. While I think that Costa’s shares are trading at a reasonably attractive level now, I’m holding off an investment until its performance improves.
The Platinum Asset Management Limited (ASX: PTM) share price has shed 7% of its value since the start of the year. The catalyst for this was an update out of the asset manager last week which revealed that it will record an unrealised loss on its seed investments and also receive little in the way of absolute return related performance fee income for the half-year ending December 31. There are concerns that the underperformance of its funds could lead to meaningful fund outflows this year. I think these concerns are valid and would suggest investors stay clear of its shares for the time being.
The Super Retail Group Ltd (ASX: SUL) share price has tumbled 7.5% so far this year. The driver of this decline was an underwhelming trading update from Kathmandu Holdings Ltd (ASX: KMD) earlier this month. Kathmandu experienced a sudden deterioration in its sales over the Christmas period, sparking fears that Super Retail’s BCF and Macpac brands might also have suffered the same fate. While I do think there is a risk of this being the case, at around 9x earnings I think it has more than been priced in now. This could make Super Retail a good option for investors.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO. The Motley Fool Australia owns shares of Platinum Investment Management Limited and Super Retail Group 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.