This hot ASX 300 stock is down 30% since February. Is it a buy?

This stock has fallen hard, but should investors buy the dip?

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Today, let's discuss an ASX 300 stock that was one of the hottest shares on the market until very recently. This ASX 300 stock rose more than 120% between April and November last year, and added another 40% between November and February 2024. 

Between April 2023 and February 2024, this company returned a whopping 215% or so in share price gains. It doesn't get much hotter than that.

And yet this company has gone from hot to cold very quickly since February. Just six weeks ago, you could have bought or sold this share for roughly $4.66 each. But today, you can trade those same shares for just $3.36 at the time of writing. That's a fall worth almost 31%.

Why has this hot ASX 300 stock taken a cold bath?

The ASX 300 stock in question is none other than online retailer Cettire Ltd (ASX: CTT). Yes, shareholders of Cettire were enjoying a very hot investment in terms of share price gains until February. But things have dramatically come off the boil since then.

Check that all out for yourself below:

The catalyst for these most recent falls appears to be the monster $127 million stock sale by Cettire founder and CEO Dean Mintz.

In early March, we covered how Mintz managed to execute a 27.5 million block sale (representing 7.2% of all of Cettire's outstanding shares). Mintz bagged a cool $127.3 million from this trade, which he managed to secure at a price of $4.63 per share.

Even after this sale, Mintz retains a rough 30% stake of this ASX 300 stock, and remains its largest single shareholder.

But still, investors were not impressed with this news, with the sale arguably sparking the share price slump investors have been enduring ever since. Allegations that came out around the same time, alleging that Cettire wasn't pricing its products to correctly include shipping, duties and taxes, didn't help either.

Is Cettire a buy right now?

So investors who enjoy adopting a 'buy-the-dip' mentality might be sitting up and taking note of this recent ASX 300 stock sell-off. After all, successful companies that undergo a pullback often offer up lucrative buying opportunities with the benefit of hindsight.

But let's see what ASX experts reckon about Cettire shares right now.

Last month, we looked at one fund manager's view on Cettire. Analysts at Wilson Asset Management (WAM) told investors they were indeed buying the dip, and heavily:

When the article [regarding the customs duties] came out, we knew the stock was going to fall a lot… so we took the liberty to buy more stock, and we've been buying more stock every day since.

But WAM isn't the only one eyeing Cettire off. Last month, my Fool colleague James also covered ASX broker Bell Potter's views on this ASX 300 stock.

Bell Potter told investors that they should indeed be buying the dip with Cettire in the wake of its stock price collapse.

The broker retained a buy rating on the company, with a 12-month share price target of $4.14. That would result in a strong recovery from where the shares are today if accurate.

Here's some of what the broker said on its call:

We think CTT's ability to outperform their peer group far outweighs others given the ~0.9% market share and further supported by the ongoing consolidation in the luxury e-commerce market. We also view CTT's current EBITDA margins ahead of other e-commerce players with minimum risk associated with the drop-ship inventory model. We retain our BUY rating.

So it seems that at least these two ASX experts are united on their views of Cettire as an undervalued ASX 300 stock today. Let's see if they're right.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. 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 recommended Cettire. 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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