Earlier today I looked at a few shares which have just climbed to record highs.
Unfortunately, not all shares are on a high right now. In fact, the three shares listed below have just slumped to 52-week lows or worse.
Here’s why they are down in the dumps right now:
The Amaysim Australia Ltd (ASX: AYS) share price was trading at a record low of 43 cents at the end of last week before rebounding slightly. Investors have been hitting the sell button in a hurry since the release of a bitterly disappointing full year result for FY 2019. The junior telco company reported a 7.8% decline in revenue to $508.3 million and a $6.5 million loss. A key driver of this underperformance was a 4.8% decline in recurring mobile subscribers to 624,000. This appears to have sparked concerns that Amaysim’s subscriber numbers may now have peaked after several years of strong growth.
The Class Ltd (ASX: CL1) share price dropped to an all-time low of $1.21 on Friday. The SMSF platform provider’s shares have come under significant selling pressure this year after its growth slowed materially. In FY 2019 Class reported a paltry 3% rise in net profit after tax to $9 million after increasing the number of accounts on its platform by 5.7% to 179,082 accounts. It appears unlikely to be any better in FY 2020. The next 12 months look set to be a transformational period as the company looks into entering new markets. Whilst this has the potential to underpin strong growth in the future if the move is successful, judging by the share price slump, some investors don’t appear convinced by it.
The Spark Infrastructure Group (ASX: SKI) share price dropped to a 52-week low of $2.15 at the end of last week. Whilst this latest decline was due to the regulated utility infrastructure company’s shares trading ex-dividend for its 7.5 cents per share interim dividend, its shares have come under pressure recently due to a weak first half performance. In the first half of FY 2019 the company posted a 12.2% decline in underlying net profit due to the underperformance of its Victorian distribution business and higher operating costs.
Instead of buying Amaysim, Class, or Spark, I would be buying these dirt cheap shares which look set to charge higher in 2020.
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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 Class 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.