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Why Kogan and these ASX shares have crashed lower in 2020

Earlier today I looked at three shares that have just climbed to 52-week highs or better.

Unfortunately, not all shares are flying high in January. Here’s why these shares have been sold off this month:

Kogan.com Ltd (ASX: KGN)

The Kogan share price has crashed 28% lower since the start of the year. Investors were selling Kogan’s shares after it released a surprisingly disappointing first half update. Kogan reported gross sales and gross profit growth of 16% and 9%, respectively, over the prior corresponding period. This was a sharp slowdown on its gross profit growth during the first quarter when it delivered a 28% increase over the prior corresponding period. This appears to have been driven by a material decline in Third-Party Brands sales.

Mosaic Brands Ltd (ASX: MOZ)

The Mosaic Brands share price is down a disappointing 27% in 2020. The fashion retailer, formerly known as Noni B, came under pressure after advising that comparable sales through the second half of November and throughout December were significantly impacted by the devastating bushfires. As a result, first half reported EBITDA is expected to be up 36% to ~$32 million. Whilst on paper this looks like solid growth in a challenging retail market, it has fallen well short of expectations following some significant acquisitions.

NIB Holdings Limited (ASX: NHF)

The NIB share price has fallen 12.7% since the start of the year. The private health insurer’s shares were sold off after it downgraded its FY 2020 guidance. NIB advised that it now expects FY 2020 underlying operating profit (UOP) to be at least $170 million, with statutory operating profit of at least $150 million. Previously, NIB had guided to UOP of at least $200 million and statutory operating profit of at least $180 million. Management explained that the profit downgrade was due largely to an increase in claims expenses across much of the business.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Kogan.com ltd and NIB Holdings 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.

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