Why Bendigo and Adelaide Bank, Challenger, Seek, and Sims shares are dropping

These ASX shares are out of form on Tuesday…

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The S&P/ASX 200 Index (ASX: XJO) is having another solid day on Tuesday. In afternoon trade, the benchmark index is up 0.5% to 7,100.6 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are dropping:

Bendigo and Adelaide Bank Ltd (ASX: BEN)

The Bendigo and Adelaide Bank share price is down over 4% to $9.44. This morning the team at Goldman Sachs downgraded this regional bank's shares to a neutral rating with a trimmed price target of $10.60. Goldman admitted that it got it wrong with the bank. It said: "[T]oday's result showed that we had underestimated the extent to which the NIM upside that we had initially anticipated BEN would enjoy due to higher cash rates."

Challenger Ltd (ASX: CGF)

The Challenger share price is down over 11% to $6.33. Investors have been selling this annuities company's shares after the release of its full year results. Challenger reported a statutory net profit after tax of $254 million for FY 2022. This was down a disappointing 57% from FY 2021.

SEEK Limited (ASX: SEK)

The Seek share price is down 5% to $23.19. The catalyst for this was the release of the job listings company's full year results. Although Seek delivered an 81% increase in net profit after tax (excluding significant items) to $245.5 million, this was still short of expectations. Goldman Sachs notes that Seek's result was a "slight miss" and its "FY23 outlook [was] mixed."

Sims Ltd (ASX: SGM)

The Sims share price is down 3% to $15.25. This was despite the scrap metal company reporting a 161.2% increase in net profit to $599.3 million in FY 2022. Management's cautious guidance could be weighing on its shares. It notes that ferrous prices have halved in value over the last few months from US$700 per tonne in March to between US$320 and US$400 per tonne at the start of FY 2023.

Motley Fool contributor James Mickleboro has positions in SEEK Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended Challenger Limited and SEEK Limited. 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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