Disappointing, what else can one say about the share prices of Woolworths Limited (ASX: WOW), G8 Education Ltd (ASX: GEM), and Sirtex Medical Limited (ASX: SRX) lately?
Every investor should be asking 'do these falls represent an opportunity for me here?'
Because as we hopefully all know, share prices don't tell the full story when it comes to stock picking.
At least two of these three stocks look like buys at today's prices; here's what you need to know:
Woolworths Limited – last traded at $28.65, down 19% for the year
Woolies shares are looking 'cheap cheap', if you'll pardon the pun.
The supermarket giant's fall from grace has been well publicised, with Masters hardware, slower retail sales than competitor Wesfarmers Ltd's (ASX: WES) Coles stores, and the spectre of increased competition from market entrant Aldi all combining to spook investors.
Despite all this negativity there are a number of compelling advantages to owning Woolworths shares which contributor Ryan Newman outlines in this phenomenal article.
With a Price to Earnings (P/E) equation of 15, Woolworths also looks cheap compared to the rest of the ASX, and is one bargain company I'd snap up with $10,000.
G8 Education Ltd – last traded at $3.46, down 12.5% for the year
G8 is my most recent acquisition, with recent falls from prices of up to $5.50 earlier this year proving too tempting to pass up.
While the market is apparently worried about the effects additional government legislation could have on the childcare business, I believe that these fears are unfounded.
Removal of powerful government subsidies has not prevented aggregator 1300 Smiles Limited (ASX: ONT) from continuing to deliver great outcomes to shareholders (1300 Smiles is in dentistry, but uses a similar low-cost acquisition business model to G8 Education).
Fellow contributor Tim McArthur felt that the company could be a buy at $4.04 per share, a sentiment he is no doubt echoing as shares change hands for less than $3.50.
(For the record, I recently bought my shares at $3.71)
Sirtex Medical Limited – last traded at $22.12, up 11% for the year
Ahh, Sirtex Medical – sure to be the star of this article, with its catastrophic 50% fall yesterday drawing a lot of attention and again illustrating what happens to biotech stocks when expectations exceed reality.
(Contributor Darryl Daté-Shappard has the full coverage of Sirtex's market update here)
Although I think Sirtex is a great company with rapidly growing sales that has a lot to offer investors, I would be waiting a little longer before making a purchase, as I suspect shares could continue to decline.
Today's rise was clearly due to opportunistic buyers stocking up, but with shares still 50% higher than they were twelve months ago, I'm not sure if what you pay is what you get.
If discount shares are your thing, The Motley Fool's top analyst Scott Phillips has identified three companies with growing earnings and dividends that are still trading at appealing prices despite falling interest rates.
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