Although the market has recorded a strong gain so far this year, not all shares have been pushing higher.
In fact, a number of shares have fallen so hard this year they are now trading at 52-week lows. Three shares that have made this milestone are listed below. Here’s why they have been beaten down in 2019:
The CYBG PLC (ASX: CYB) share price continued its poor run and dropped to an all-time low of $1.86 on Wednesday. Investors have been selling the UK-based bank’s shares since it was forced to increase the provisions for legacy PPI costs by between £300 million and £450 million last month. This was primarily driven by an unprecedented volume of PPI Information Requests received during August in advance of the August 29 deadline. Not only was it significantly more than the market had expected, it appeared disproportionately large in comparison to its peers.
The FBR Ltd (ASX: FBR) share price fell to a multi-year low of 5.8 cents yesterday. The robotics company’s shares have come under significant pressure over the last 12 months due to concerns over its change of business model and the termination of a memorandum of understanding with US construction machinery giant Caterpillar. In respect to the latter, there had been hopes that Caterpillar would take its house-building robot to the masses, but sadly this wasn’t to be. And while a joint venture with Brickworks Limited (ASX: BKW) has promise, five months after it was formed there has yet to be any news from it.
The Webjet Limited (ASX: WEB) share price fell again on Wednesday and dropped to a 52-week low of $9.98. The online travel agent’s shares have fallen heavily this year amid concerns over the rising threat of Google in the travel market and the collapse of its UK partner Thomas Cook. The latter has come at a cost to Webjet due to Thomas Cook’s unpaid receivables of €27 million. It also loses a revenue source and is expected to reduce Webjet’s WebBeds EBITDA growth by up to $7 million in FY 2020. While these series events are disappointing, at 18x trailing earnings I feel its shares offer investors a compelling risk/reward. Especially given how management recently reiterated that the rest of the business is performing in line with its guidance.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Brickworks and Webjet 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.