A decent run since Christmas means that the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has now narrowed its 12-month decline to 2.7%.
While this is still a little disappointing, spare a thought for shareholders of the three shares listed below.
These shares have fallen heavily over the period. Are they cheap enough to buy now?
The Bellamy's Australia Ltd (ASX: BAL) share price has dropped a massive 49% since this time last year and over 67% from its 52-week high. The infant formula and baby food company's shares have come under pressure due to delays in gaining the SAMR approval required to sell its products on the China mainland. Unfortunately, a recent note out of Goldman Sachs has suggested that these delays may continue, meaning it could be as late as FY 2021 before it sells products in China. This would be very disappointing and limit the company's growth over the short term. While I do still see it as a good long-term investment, investors will need to be patient.
The Estia Health Ltd (ASX: EHE) share price has tumbled 35% over the last 12 months. Investors have been hitting the sell button in a panic since the government announced a Royal Commission into the aged care sector. This inquiry kicks off today and is likely to weigh on Estia Health and its peers for much of the year. In light of this, despite how cheap its shares look, I would stay clear of its shares until the final report is released next year.
The NIB Holdings Limited (ASX: NHF) share price has dropped 22% since this time last year. The private health insurer has seen its shares sold off due to tough trading conditions and concerns over future caps on premium increases. In respect to the latter, it is looking more and more likely that Labor will win the next Federal election. Which could be bad news for NIB and its peers as Labor has promised to cap premium increases at just 2% for two years. Although I'm not a big fan of NIB, I do think its shares look reasonable value now after this pull back.
