The S&P/ASX 200 Index (ASX: XJO) may have ended the week with a decline on Friday, but that didn't stop it from recording its seventh consecutive weekly gain. The benchmark index climbed 0.5% to 6,675.5 points.
Although a good number of shares climbed higher, not all were on form. Here's why these were the worst performers on the ASX 200 last week:
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Mesoblast limited (ASX: MSB)
The Mesoblast share price was far and away the worst performer on the ASX 200 last week with a massive 47.6% decline. The majority of this decline came on Friday after investors sold off the biotech company's shares following the release of an update from its COVID-19 trial. That update revealed that its remestemcel-L product was unlikely to meet its 30-day mortality reduction endpoint. This prompted the US Data Safety Monitoring Board to essentially advise Mesoblast to end the trial early and recruit no further patients. This news has sparked concerns that its ~US$1.2 billion deal with Novartis for remestemcel-L could hit the rocks.
A2 Milk Company Ltd (ASX: A2M)
The a2 Milk share price was a poor performer and sank 22.4% lower over the five days. Once again, this decline came on the final day of the week when the infant formula and fresh milk company's shares crashed lower following a guidance downgrade. Due to weakness in the daigou channel, a2 Milk has downgraded its revenue guidance to be in the range of NZ$1.4 billion to NZ$1.55 billion. This is down from its previous guidance of NZ$1.8 billion to NZ$1.9 billion. Management also reduced its EBITDA margin guidance to between 26% and 29% from ~31%.
Service Stream Limited (ASX: SSM)
The Service Stream share price wasn't far behind with a 20.4% decline last week. Investors were selling the essential network services company's shares after it announced that it has been awarded a multi-year contract with the NBN. While this would ordinarily be a positive, the company revealed that it would be sharing the work with three other providers. This means it will be generating notably less revenue that the market was previously expecting.
AVITA Therapeutics Inc (ASX: AVH)
The AVITA share price was out of form and dropped 13.8% lower over the five days. Investors were selling the regenerative medicine company's shares after S&P Dow Jones Indices announced its quarterly rebalance of the S&P/ASX Indices. This rebalance will see AVITA's shares dumped out of the ASX 200 index on 21 December.
