The worst stocks of 2020: Southern Cross Media, Avita and Sky TV
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The last eight months or so have been a helluva time for the ASX, but a few dozen shares haven’t come along for the ride.
As of December 14, 44 companies were trading at half their value or less from where they began the year, despite months of fiscal stimulus and vaccine optimism.
We aren’t about to vouch for any of these companies, but value hunters who believe in “buying low” could do a lot worse than beginning there research here.
The list includes 22 nanocap companies (worth under $50 million), 16 microcaps (worth between $50 million and $200 million), four small-caps (worth between $200 million and $1.5 billion) and one mid-cap: Flight Centre (ASX:FLT), whose shares have been trading around $16 to $17 recently, compared to just under $40 at the beginning of 2020.
European mall owner Unibail-Rodamco-Westfield (ASX:URW) is the only large-cap company on the list. Its shares on December 14 were trading recently at $4.98, down 52.3 per cent from the start of the year.
The worst performance belongs to ChongHerr Investment (ASX:CDH), a Queensland sandstone quarrying company whose shares have been suspended from trade since April 2.
Its shares last traded for 0.2c a share, down 80 per cent from the start of the year, giving it a market capitalisation of $260,000 – truly “nano”.
ASX COMPANIES STILL DOWN AT LEAST 50 PER CENT SINCE DECEMBER 31
|Code||Company||Price (Dec 14)||YTD return %||30-day return|
|ABL||Abilene Oil & Gas||0.1||-66.7|
|EMUCA||EMU NL - 3C Pd, 3C Unpd||2||-57.4||-23.1|
|AFR||African Energy Res||1.8||-55.0||-18.2|
|FOD||The Food Revolution||3.6||-55.0||-14.3|
|AYI||A1 Invest & Res||0.1||-50.0||-50.0|
|SXL||Sthn Cross Media||226||-61.7||17.1|
|VGL||Vista Group Int||165||-50.6||3.1|
|AJL||AJ Lucas Group||2.7||-60.9||-38.6|
|FLT||Flight Centre Travel||1621||-59.1||3.5|
Here are the worst-performing shares in the small-cap space:
Southern Cross Media
Radio station owner Southern Cross Media (ASX:SXL) shares are down (as of December 14) over 60 per cent since the start of the year, amid a generally brutal year for broadcast media.
(Don’t be deceived if when perusing charts, you see a huge spike in the SXL share price in November — that was the result of a 10-for-1 stock consolidation.)
Chief executive Grant Blackley told the company’s annual general meeting October 30 that while the pandemic had had a severe impact on Southern Cross’s business, it “has also accelerated consumer trends that will play to our strengths and strategy as economy activity progressively recovers.”
Consumption of audio is up strongly and is becoming more accessible than ever before through internet-enabled devices, Blackley said. Southern Cross is poised to capitalise with its talent-led approach to podcasting, music curation and creating compelling content.
After a stellar 2019 it’s all come undone for Avita Therapeutics (ASX:AVH), whose shares have gone from less than $2 in 2018 to more than $15 in February 2020 to under $6 lately.
The burn care company’s shares took a tumble at the start of the pandemic, and they have never really come back.
— Samborghyni (@Samborghyni) November 2, 2020
For the three months to September 30, Avita announced it had made $US5.1 million ($6.8 million), up from $US3.3 million ($4.4 million) a year ago, but its operating loss grew from $US3.7 million ($4.9 million) to $US10.2 million ($13.5 million).
Kiwi satellite broadcasting company Sky Network (ASX:SKT) is the third-worst ASX small-cap performer, its shares down 57.9 per cent from the start of the year. (It has no connection with London-based Sky Group, the European pay-TV broadcaster).
Sky is another company whose shares crashed at the start of the pandemic and haven’t really recovered.
The company this month promoted chief operating officer Sophie Moloney to the role of CEO – its first woman to hold the position – to replace Martin Stewart, who is returning home to Europe.
Sky is forecasting a net profit this financial year of $NZ20 million to $NZ30 million ($18.8 million to $28.2 million), on revenue of $NZ680 million to $NZ710 million ($639 million to $667 million). The company says it is exercising careful cost-control measures and is pleased with the growth of its Neon streaming service.
Shares in Kiwi film industry technology company Vista Group (ASX:VGL) were trading at $1.65 on December 14, down 50.6 per cent from the start of the year.
Visata Group is the parent company to eight businesses, including a cinema management platform, the Flicks chain of moviegoing websites, and a film distribution software firm.
The company announced October 21 that while it was hard to predict when the film industry would “return to normal,” the rebound in moviegoing in countries where cinemas had reopened supported its belief that the industry would bounce back in 2021.
“We remain confident in the future of the film industry and we are pleased to see areas of strong and consistent recovery, whilst acknowledging that there is a way to go,” group CEO Kimbal Riley said.