For all the frightening headlines of trade wars, rising interest rates and overheated stock markets, the broad indexes are all up for 2018. But there are always stocks that are down significantly, and screening the worst performers can highlight potential bargains.
Looking at the S&P 1500 Composite Index (comprising the S&P 500 SPX, -0.71%[1] the S&P 400 Mid Cap Index MID, -0.74%[2] and the S&P 600 Small Cap Index SML, -0.68%[3] ), 104 stocks had plummeted at least 20%, including reinvested dividends, for 2018 through July 6.
Narrowing the list further, 81 of those companies had increased their sales per share for the most recently reported 12-month period from the year-earlier 12-month period and 29 had improved their gross profit margins at the same time.
Of those, 17 also improved their sales per share and gross margins for their most recently reported quarters from a year earlier. That could signal investors have been overreacting and that there are opportunities for bottom-fishers.
At many of these companies, shares have pulled back following major gains in 2017.
Don’t miss: Small-caps—a stock leader of 2018—has been downgraded by Morgan Stanley[4]
Here they are, sorted by how poorly their shares have performed this year (the sales and margin figures will follow, along with a summary of analysts’ opinions of the companies):...
| Company | Ticker | Industry | Total return - YTD | Total return - 2017 | Total return - 3 years | Total Return - 5 years |
| MiMedx Group Inc. | MDXG, +0.15%[5] | Biotechnology | -73% | 42% | -70% | -51% |
| Coherent Inc. | COHR, -2.76%[6] | Electronic Equipment/Instruments | -44% | 105% | 152% | 169% |