10 Shares Trading Near 52-Week Lows

LONDON -- Shares have had a good run. In the last three months alone, the FTSE 100 is up 7.3%.

Despite the market's advance, some shares are struggling. However, it has become much harder these days to find laggards. As such, I've had to trawl the market to find shares priced within 6% of their twelve-month lows to present a group of strugglers.

In many of the cases below, the market has clearly turned against a whole sector. Currently, resources shares are performing especially poorly. Yet there are stock-specific reasons behind some price falls:

Company

Price (pence)

P/E

Yield

Market Cap (millions of pounds)

Anglo American (LSE: AAL.L  )

1,790

8

2.8%

24,828

Eurasian Natural Resources

306

4.9

3.6%

3,935

Kazakhmys

587

5.7

2.5%

3,072

EVRAZ

218

15.9

8.1%

2,919

ICAP

316

11.2

7%

2,040

Songbird Estates (LSE: SBD.L  )

105

N/A*

N/A

1,637

Essar Energy

100

196.3

N/A

1,297

UK Commercial Property Trust

69

51.8

7.7%

819

Bwin.Party Digital Entertainment (LSE: BPTY.L  )

93

N/A*

2.8%

747

Petropavlovsk (LSE: POG.L  )

366

6.7

3.3%

683

*Previously loss-making.

I have picked out four shares that look particularly interesting.

1. Songbird Estates
Songbird Estates is one of AIM's largest companies. It owns considerable assets in and around London's Canary Wharf, including the iconic Canary Wharf tower.

Some 68% of Songbird's shares are owned by three overseas institutions, and the resultant 32% "free float" is likely to deter other institutional fund managers from investing. You see, fund managers tend to avoid companies where a lack of share "liquidity" prevents them from easily building or disposing of their stakes. In addition, investors are often wary of situations where a small number of shareholders can collaborate to the disadvantage of others.

There is also no dividend on offer.

Interestingly, the most recent final results reported a net asset value of 190 pence per share -- or 81% in advance of today's share price. However, the company also reported a reduction in rental income. Clearly, if that trend continues, the value of the company's property assets may gradually decline, and the discount could narrow.

2. Anglo American
Anglo American is a diversified mining company. The majority of the company's assets involve iron ore, manganese, coal, and copper.

The entire resources sector has been hit hard by fears over a slowing of growth in China. Even shares in a diversified titan such as Anglo American have suffered.

Shares in Anglo American currently trade at just 9.6 times 2012 earnings forecasts. That rating is somewhat less than the current market average. However, Anglo American's dividend yield is also less than that provided by most FTSE 100 shares.

While these shares are currently out of favor, they are not excruciatingly cheap. It is also worth considering whether earnings forecasts will be met, should commodities prices fall further.

Before the great natural-resources boom, shares in Anglo American traded for less than 1,000 pence. On the other hand, the shares were close to twice today's price just more than two years ago. Perhaps this is one to watch and wait.

3. Bwin.Party Digital Entertainment
Formed in March 2011, Bwin.Party is an amalgamation of online casino business PartyGaming and sportsbook Bwin Interactive Entertainment AG.

As with many companies in this sector, government regulators have played a huge role in Bwin.Party's life story. Go back six years, and PartyGaming reported six-month revenue of $669 million. At the time, its PartyPoker website was the No. 1 poker site in the world. Shortly afterward, however, U.S. regulations changed, and PartyPoker withdrew from operating in the U.S. The mantle of "world's leading poker site" has long since passed to Isle of Man-based PokerStars.

Fast-forward to today, and Bwin.Party as a combined entity is reporting lower revenue than PartyGaming made on its own in 2006.

There are signs, though, that the U.S. market may be opening up again for online poker. However, PokerStars' recent takeover of Full Tilt Poker will make it more difficult for Bwin.Party to ever re-establish itself as a leading U.S. poker site.

Bwin.Party is trading on what looks like an attractive 8.5 times full-year forecasts. However, recent interims disappointed, and now the market seems to be questioning Bwin.Party's ability to hang on to customers for the long term.

4. Petropavlovsk
Let's be honest: Just the name "Petropavlovsk" would be enough to put some investors off.

Petropavlovsk began life as AIM-traded Peter Hambro Mining. In 2009, the company merged with Aricom, moved up to the Main Market, and changed its name to Petropavlovsk. The company is today a Russia-focused gold miner. Petropavlovsk also owns 65% of Hong Kong-listed resources company IRC Limited. By my calculations, the IRC stake is worth almost 100 million pounds by itself.

Shares in Petropavlovsk have fallen 57% in the last twelve months. However, there may be reason to believe things could be looking up. Although gold prices are down 10% in the last year, the price has fought back recently and is in fact up 5% in the last month alone. As Petropavlovsk no longer has any hedging in place, any further increase in the price of gold should boost profits. Petropavlovsk has held its dividend for the last two years but is expected to increase it for 2013.

A further contrarian idea
If you are prepared to research shares other investors are rejecting, then you are probably a contrarian investor. The greatest investor of them all, Warren Buffett, also likes to swim against the tide. Indeed, one of his latest purchases involved a U.K. household name whose shares slumped 20% earlier this year.

To discover which FTSE 100 share Buffett has been buying that others have dumped, download the free Motley Fool report "The One U.K. Share That Warren Buffett Loves." The report is 100% free and will be delivered to your inbox immediately.

David Kuo challenged his Motley Fool analysts to pinpoint the attractive sectors of 2012 -- and they delivered! Discover the industries they selected in this new Motley Fool guide -- "Top Sectors for 2012"-- while it's still free!

Further investment opportunities:

David does not own shares in any of the above companies. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2009248, ~/Articles/ArticleHandler.aspx, 9/19/2014 2:02:13 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement