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Highlights
- Few of the ASX companies have lost over 50% of their value so far in 2021.
- The drop is due to challenges posed by the ongoing coronavirus pandemic and weak financial results, which hurt the stock price significantly.
- The latest rise in US bond yields has also negatively impacted the prospects of some of the ASX 200 shares, especially the ones belonging to the information technology category.
Even as 2021 has been a fairly good year for ASX 200-listed shares, a few companies have lost over 50% of their value so far. The drop is due to the challenges posed by the ongoing coronavirus pandemic and weak financial results, which ended up hurting stock prices significantly.
The latest rise in US bond yields has also negatively impacted the prospects of some of the ASX 200 shares, especially the ones belonging to the information technology category.
Even as a fall in these stocks has created opportunities for investors looking for value, investors should be careful now and conduct extensive research before picking up recently beaten down shares. Investors should currently not only look at reduced prices but also strong growth potential before buying shares.
Here are two ASX-listed shares that have lost more than half of their value in 2021:
Appen Ltd (ASX:APX)
Appen is an information technology company which deals with linguistic services. The stock has lost nearly 65% value so far this year. Since the company hit its peak in August 2020, the stock is down by over 78%.
On Wednesday, the stock price hit as low as AU$8.87 per share and the stock is currently sitting at a 3-year low.
Other than the recent rise in US bond yields, the reduced predictability of the US monetary policy has also impacted the tech stock. Generally, investors are more likely to sell tech shares during uncertainty.
The company announced its FY21 first-half results in August:
* Group revenue was down 2% to US$196.6 million.
* Underlying EBITDA was down 14.3% to US$27.7 million.
* Net profit after tax (NPAT) was down 55.1% to US$6.7 million.
AGL Energy Ltd (ASX:AGL)
AGL Energy provides energy to residential and business customers in Australia. Since the start of the year, the company’s stock price has slipped 51.6%.
The FY2021 has been challenging for the company’s shareholders. As per its full-year result for FY21:
- Revenue decreased 10% on the prior corresponding period to AU$10.9 billion.
- Underlying profits dropped 33.5% to AU$537 million on the prior corresponding period.
Other than weak financial results, the company struggled due to the coronavirus pandemic as rise in supply, combined with muted demand for energy hurt its earnings.
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