How to find winners from badly performed stocks on NZX 50 in 2017

[Valuegrowth]

Please share stocks which performed badly in New Zealand in 2017?

Are there over looked, badly beaten down and turnaround candidates?
Have you found any attractive stocks which dropped badly over the past 18 months?

[hogie]

Please share stocks which performed badly in New Zealand in 2017?

Are there over looked, badly beaten down and turnaround candidates?
Have you found any attractive stocks which dropped badly over the past 18 months?


TWR is my beaten down winner so far ... so far glad I got in at 66c :)

[Valuegrowth]

Thanks hogie. Happy to hear about that. GL!


TWR is my beaten down winner so far ... so far glad I got in at 66c :)

[iceman]

Marketwinner why are you looking for losers ? Why not look for winners that will go further ?

[traineeinvestor]

If sentiment on this forum was a good contrary indicator, we'd all be loading up on MPG, TGH and FBU. These businesses all have value and, at some point, they may be good investments (with the emphasis on "may"). I have a small shareholding in FBU but am a long way from investing meaningful amounts of money in any of the three - i just see lower risk propositions elsewhere.

[Balance]

If sentiment on this forum was a good contrary indicator, we'd all be loading up on MPG, TGH and FBU. These businesses all have value and, at some point, they may be good investments (with the emphasis on "may"). I have a small shareholding in FBU but am a long way from investing meaningful amounts of money in any of the three - i just see lower risk propositions elsewhere.

MPG - wait for appointment of new CEO.

FBU - wait for capital raising (will be similar to TWR).

TGH - screwed until major change of business strategy, which will be impossible to change without massive short term costs.

[Filthy]

FBU - wait for capital raising (will be similar to TWR)

or sale / break-up of the various business units....?

[silu]

MPG - wait for appointment of new CEO.

FBU - wait for capital raising (will be similar to TWR).

TGH - screwed until major change of business strategy, which will be impossible to change without massive short term costs.

I have exactly the same 3 earmarked for potential entry on reversal.

[winner69]

TRA Turners

This will be their year ...won’t go down another 25% odd

[Beagle]

Marketwinner why are you looking for losers ? Why not look for winners that will go further ?

Agree 100%. Most of the mutts have a heavy flea infestation that often takes years to fix. Better off backing pedigree greyhound winners, its far more rewarding.

[percy]

TRA Turners

This will be their year ...won’t go down another 25% odd

After reading today's TRA shareholder newsletter, it looks as though there is more likely a 25% increase in share price, in the not too distant future.Maybe the full year result at the end of May will be the catalyst.?.I certainly hope so, as I recently added to my already overweight holding.!

[Balance]

or sale / break-up of the various business units....?

Probably too late then to invest as sp will take off fast on such an announcement.

Capital raising - sp will drop temporarily until capital raising is out of the way.

[Balance]

Agree 100%. Most of the mutts have a heavy flea infestation that often takes years to fix. Better off backing pedigree greyhound winners, its far more rewarding.

As a general rule, absolutely yes.

Can be very rewarding to pick up losers though if they put on 500% like Serko or ATM which put on several thousand %!

[Beagle]

TRA Turners

This will be their year ...won’t go down another 25% odd

Yeap this is one of the dogs of 2017 that's more likely than most to bark a bit this year. How it might run compared to SUM of the other greyhounds however is quite another matter. Unlikely to do anything other than a pathetic wimper is EVO, MPG, TGH and Orion Healthcare to name just four that readily spring to mind.

[Valuegrowth]

Thank you so much everybody for some great ideas. I really appreciate. My aim is to find out at least five promising companies.They should be mid-term and long term winners. I have some amphibious boat builder future mobility solutions (formerly Sealegs) stocks bought long ago. It is one of the worst performers in the market. I bought it thinking some new technology involvement and export market. I also had Dominion Finance shares. Fortunately, I escaped from selling 2/3 of my holdings. It is not worth to consider some badly performing stocks with poor fundamentals but I really like badly preforming overlooked future turnaround companies and companies with future strong fundamentals. Hopefully, I will find some.

[Nasi Goreng]

I think GXH has been beaten to a pulp. Sentiment has gone against it but I don't see that business falling off the map at all. In fact, they continue to grow year on year so if they do that this year, I wouldn't expect the share price to stay at current levels.

[GTM 3442]

Two classes of losers.

My preference is for those which have been whacked by some sort of external one-off event. Like Seeka with the PSA virus or Chorus and the Commerce Commission. There don't happen often.

The others, well you have to be a believer in the "turn-around" story, don't you. Can the current management do it? Is there new management who can do it?

All I can think of at the moment is Fletcher Building. . .

[artemis]

Possibly PIL. Share price badly damaged by a potential Arthrem health issue and they don't seem to be doing the TV advertising at the mo. A lot of Artevite advertising though (canine product), maybe taking the place of scheduled Arthrem ads. Recent launch of both products on Australia but a bit later than planned so revenue not as expected.

It is not clear to me if it is the generic extract or Arthrem in particular. Seems unlikely to be just the latter as various formulations of the extract are widely used globally. (A Nobel prize was awarded for its use in treating malaria a few years ago.)

PIL seem to be proceeding cautiously but say the incidence of adverse reactions is minute.

So a risk but perhaps worth a punt at under a cent.

[hardt]

I think GXH has been beaten to a pulp. Sentiment has gone against it but I don't see that business falling off the map at all. In fact, they continue to grow year on year so if they do that this year, I wouldn't expect the share price to stay at current levels.

With the success of chemist warehouse in ST Lukes, and a new one opening right next door to Unichem Max in Botany with plans to open many more in Auckland it comes as little surprise.

Seeing as 80%+ of their operating profit and just about all their growth comes from Pharmacy... it is understandable why this has slumped.

[Valuegrowth]

Thank you so much everybody for some great ideas.

Today’s some top winners in the market are yesterday’s neglected stocks. Neglected shares are under-researched by analysts and potentially misunderstood by investors. Some analysts specialized in overlooked and neglected stocks will look for companies with low analyst coverage, above average earnings growth and that are cheaply priced according to their price to earnings and price to book ratios.

https://www.fool.sg/2018/04/05/these-3-stocks-are-trading-close-to-their-52-week-lows/

https://www.quant-investing.com/blogs/general/2015/01/20/1374.2-return-from-neglected-value-and-momentum-companies

[Valuegrowth]

Following stocks also came into my mind. In addition to stocks which are having major uptrend (multi baggers) attractive growth oriented and fundamentally sound stocks in the following categories also could outperform broader market in 2018/19.

Beaten down value stocks
Beaten down growth stocks
Beaten-Down Turnaround Candidates

https://seekingalpha.com/article/4137805-stocks-2018-beaten-dividends-recession-resistant

Stocks For 2018: Beaten Down, With Dividends, And Recession Resistant

[steveb]

Of course don't forget BLIS seems to me it's going to remain a dog.Any profits they might make the directors will gobble it up in directors fees.I have a small holding but have written it off as not worth selling.

[Valuegrowth]

I also have one in the same sector. For nearly 10 years I didn’t see any progress. It also will stay as a dog for the time being. Bio technology firms have high risk as well as high return. I saw somewhere: Forget the tech bubble. It’s the biotech bubble you should worry about. I will stay with simple businesses that I can understand well. That doesn’t mean I will avoid tech stocks. I love untestable technology. We see technology everywhere. Even Agri Firms are making use of technology to raise their productivity and growth. They save a huge sum of money by adopting modern technology.

[kiora]

" I love untestable technology" I presume you mean uncontestable ?

LoRaWAN
This space potentially game changing

https://www.digikey.co.nz/en/articles/techzone/2016/nov/lorawan-part-1-15-km-wireless-10-year-battery-life-iot

[Valuegrowth]

Thank you for the link.
" I love untestable technology" I presume you mean uncontestable ?

LoRaWAN
This space potentially game changing

https://www.digikey.co.nz/en/articles/techzone/2016/nov/lorawan-part-1-15-km-wireless-10-year-battery-life-iot

[troyvdh]

As an alternative to the accepted narrative ....perhaps ....it may possibly be wise...to venture across the ditch...graphite ...gold...lithium...cobalt...titanium ...take your pick....cheers troy

[Valuegrowth]

Thank you troyvdh for naming a new commodity(unknown to me).Following types of overlooked stocks are my favorites.



Quality value stocks trading at a great discount
Quality growth stocks trading at a great discount
Great turnaround companies

[Valuegrowth]

A great company is not a great investment if you pay too much for the stock.

There will be some opportunity in stocks which shorted badly as well after their solid run hitting all time high and 52 weeks high. If we cannot find here we could find elsewhere may be in Australia, the USA, or UK. Some value stocks don’t need to have superior growth as long as they have a sustainable business, positive cash flow and reasonably strong balance sheets for the foreseeable future. Buying one dollar worth of a quality company for 50 cents is a good strategy.

There are two areas to study before buying stocks.


Future Outlook (very important)
Past Track Record

[Valuegrowth]

In my view sector oriented approach could minimize risk involve in extended markets.

Not all food stocks equally will do well. Strong firms and emerging ones should outperform others. This sector still will get boost as global consumers have more money in their pockets to spend thanks to appreciation of various types of asset classes and low commodity prices when compare with historically high prices. In addition to growing population, growing travel industry is another boost for food industry. Rapid appreciation of food commodities also cannot be expected as a result of ample supply and good weather patterns.

https://finance.yahoo.com/news/consumer-staples-outlook-april-2018-203908802.html

Consumer Staples Outlook - April 2018

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12039505

Strong travel demand lifts Boeing in first quarter

http://www.thebull.com.au/premium/a/73893-regaining-an-appetite-for-fast-food-stocks.html

Regaining an appetite for fast-food stocks

[Valuegrowth]

As stock markets have stretched throughout the world except for overlooked or neglected markets, it may be time to look for overlooked value stocks as well. I strongly believe attractive overlooked and neglected stocks have potential to outperform the market.

https://www.marketwatch.com/story/heres-a-powerful-argument-for-favoring-value-stocks-over-growth-stocks-2018-05-02

Here’s a powerful argument for favoring value stocks over growth stocks

[Pmdv77]

SLI could have some value from its current 28 to 35c over the coming 12 months.

Disc. Holding

[Hectorplains]

SLI could have some value from its current 28 to 35c over the coming 12 months.

Disc. Holding

Where are you seeing the value coming from?

[couta1]

Where are you seeing the value coming from? A takeover, otherwise it's a dog.

[Hectorplains]

A takeover, otherwise it's a dog.

I can't see where a takeover would come from? It has been mooted as a possible outcome...many times over the last 5 years. With a market cap of less than $20m the odds are, if anyone wanted it, they'd have had a go by now.

[RupertBear]

A takeover, otherwise it's a dog.

Aww come on Couta I know deep deep down you have a real fondness for SLI :p I still live in hope it will do a Serko on me :D WOOF WOOF

[Food4Thought]

I think GXH has been beaten to a pulp. Sentiment has gone against it but I don't see that business falling off the map at all.
In fact, they continue to grow year on year so if they do that this year, I wouldn't expect the share price to stay at current levels.

I have been pondering about GXH as well Nasi Goreng... I was fortunate with GXH... was my first Double Bagger. Exited and have been throwing up the ideas of what technical implications they have with all the competition for retail pharmaceuticals and products online.

Their strong capabilities and assets in the healthcare and GP area are one sector I think that is lucratively profitable. I see it as a owning the car that is operated and charging others to drive it kind of scenario. I have a feeling they are making some of the profits seem muted by spending on buying additional facilities, improvements and equipment. Be interesting to watch this one. Massive discount to approx a year ago.


Good management

[Valuegrowth]

I saw following in another website.Think differently as markets have extended so much.



When it comes to investing, it’s easy to get caught up in the latest trend. Instead, you may want to do the opposite. Look for high-quality, predictable companies trading at a reasonable price. Go into areas where no one else wants to go. Go into sectors or geographies that are a bit out of favour. Look for companies with stellar balance sheets and limited competition – profitable businesses even when conditions are challenging.