Why a2 Milk, Freedom Foods, Scentre, & TPG Telecom are dropping lower

A2 Milk Company Ltd (ASX:A2M) and TPG Telecom Ltd (ASX:TPM) shares are two of four dropping notably lower on Monday. Here's why…

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The S&P/ASX 200 Index (ASX: XJO) is on course to start the week on a very positive note. At the time of writing the benchmark index is up 0.75% to 5,798.7 points.

Four shares that have not been able to follow the market higher today are listed below. Here's why they are dropping lower:

The A2 Milk Company Ltd (ASX: A2M) share price is down 2% to $17.34. This decline appears to have been caused by profit taking after some very strong gains in 2020. Even after today's decline, a2 Milk Company's shares are up almost 24% since the start of the year. Investors have been buying the company's shares after it reported strong sales growth during the pandemic.

The Freedom Foods Group Ltd (ASX: FNP) share price is down almost 5% to $3.54. The diversified food company's shares have come under pressure since the release of a trading update at the end of last week which revealed weaker than expected sales. In addition to this, the company warned that its margins had been negatively impacted by an unfavourable sales mix.

The Scentre Group (ASX: SCG) share price has fallen 3.5% to $2.17. A number of real estate shares have come under pressure today. This appears to have been caused by an announcement by Vicinity Centres (ASX: VCX). The shopping centre operator is raising $1.4 billion to help it navigate the pandemic. It also warned that preliminary asset revaluations indicate an aggregate reduction in asset value of up to $2.1 billion.

The TPG Telecom Ltd (ASX: TPM) share price is down over 3% to $8.22. This appears to be down to profit taking after a strong share price gain over the last month. Investors have been buying TPG Telecom's shares amid optimism that its merger with Vodafone Australia will be a success. It also plans to rewards shareholders with a special dividend ahead of the merger.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended Freedom Foods Group Limited and Scentre Group. 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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