After a slow start to the week the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) finally got going on Tuesday. Thanks largely to strong performances from the information technology and materials sectors the benchmark index finished the day higher by just over 0.6% to 5,442 points.
Unfortunately not all shares were climbing higher yesterday. These four shares in particular sunk lower. Here's why:
Ardent Leisure Group (ASX: AAD) shares dropped lower by almost 8% to $2.35 after it emerged that four people had been killed in a tragic incident at its Dreamworld theme park in the Gold Coast. According to the ABC a malfunction on the Thunder River Rapids ride led to the water-based raft ride flipping over. Dreamworld has closed its doors whilst the incident is investigated.
Asaleo Care Ltd (ASX: AHY) shares fell almost 3.5% to $1.41 despite there being no news out of the personal care and hygiene company. Asaleo Care has been struggling this year due to the terrible mix of higher input costs and increasing competition. As a result its margins have been decimated and management is now expecting to post a drop in full year earnings. Whilst its shares do look cheap now, I would approach this one with caution.
Bega Cheese Ltd (ASX: BGA) shares plunged almost 17% to $5.40 after the dairy company released a disappointing update to the market. Weakness in infant formula and milk powders has led to management warning that it expects EBITDA to be in-line with FY 2016's result. With the high-growth infant formula business stalling and EBITDA growth non-existent, 35x full year earnings for its shares was too high for many investors.
Southern Cross Electrical Engineering Ltd (ASX: SXE) shares were crushed on Tuesday, falling a whopping 23% to 45 cents. The decline was a result of the mining services company advising that the first half had been slower than forecast in almost all its businesses. As a result it expects full year net profit to come in between $4 million and $5 million. This is a significant drop from last year's result of $5.4 million.
