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Falling big: the ten crashing stocks of 2022 in Tel Aviv - voila! Of money

2022-12-21T11:17:42.278Z


They went public with great fanfare and for a certain period justified the high expectations, rose to a tremendous value and generated profits for the shareholders. Only then came the stop...


"Erica B Cure Laser".

The big loser of 2022 (Photo: B Cure Laser)

In the past year, the Tel Aviv Stock Exchange has become the scene of a struggle for the attention of investors, but some of the 549 companies traded there did not manage to survive beyond the "15 minutes of fame" they were given when they joined the rising waves, before the market began to falter. An



investor diet is perhaps an effective tool for correction Inflated values, but not all the "big drops" are happy about their new configuration after the narrowing of the scopes.



The ten companies that shed the highest percentage of their share price since the beginning of the year, which stands at an average of 92.41% per share, erased approximately 2.5 billion shekels from the aggregate peak value they reached during the beginning of 2022.



The value at which 9 of the biggest decliners are traded today ranges from 3-34 million Only NIS, while the average value of the top ten that are traded today is about NIS 26 million.

The ten biggest decliners in the Tel Aviv Stock Exchange, 2022 (photo: Walla! system, without)

Laser diet

The claimant to the crown of the great mishila is the

Erica B. Cure Laser company, which is

traded on the Tel Aviv Stock Exchange with a value of approximately NIS 21 million as of the trading day on which it was tested (see table), which is a decrease of approximately 96% compared to its value at the beginning of the year.



Then its stock also soared, leading the company to a record value of about 560 million shekels, of which, as mentioned, about 539 million shekels were deleted - about a fifth of the total value deleted from the ten "big decliners" examined by Walla!

Of money .



Below it is

the medical cannabis company Univo

, which at the beginning of the week announced the appointment of a temporary trustee for the company due to its obligations to various parties, and its stock has suffered a 95.4% drop since the beginning of the year until the day of our review.

It should be noted that the entire field of medical cannabis - until recently the "great green hope" of investors - has almost disappeared from the local stock market.



However, the highest write-off amount among the ten in the table is associated with

The energy storage company Ogwind

, whose stock fell by 89.3% from the beginning of the year until the day it was tested.



The company's peak value at the beginning of the year was over NIS 1 billion and since then it has written off about NIS 915.9 million - more than a third of the aggregate write-off value of the Hirodot Bagodol team for that period.



Ogwind was also part of the growth companies that benefited from the wave of investments during the Corona period, and its value even soared to about NIS 2.5 billion as of the beginning of August 2020. But since then its stock has been on a downward trend amounting to about 95%, which led to the deletion of about NIS 2.4 billion from the peak value at that time.



The public roller coaster made companies and investors breathe the air of peaks, but also crushed them on the ground of reality - and all this in only about two years.

The question being asked today in the capital market is whether these companies will still be given an opportunity in the coming year to return to the upward trajectory, or should the investors recalculate the trajectory?

good to know (in advance)

Smoother skin after just one use with a revolutionary device for home care

Served on behalf of B Cure Laser

Liran Lublin, director of the research department at the IBI investment house (photo: Ilan Bashor)

A bad cycle met a slowdown

Liran Lublin, director of the research department at the IBI investment house, explains: "There are cycles in the capital market, and in each cycle there are companies that have inflated to significant values ​​and then shrunk, and some of them also have their value adjusted back up, even if not to the same heights that they have known in the past.



Except for the non-bank credit company 'Backing up', in which embezzlement was found that greatly affects the company, what is common to the mix of the other companies in the table absorbing the highest negative rate of return is the lack of sufficient cash in the coffers alongside big dreams for product development.



In addition, most of them rode one wave or another either upon entering the stock market or after it , which was done from the beginning in order to accumulate cash to continue promoting their activities going forward, but the thought that accompanied the growth companies of their type was that it would always be possible to raise more money in the market.



This was possible when the market was a fertile ground for fundraising, but the macro environment changed and with it led investors to other investment avenues.

From the moment the interest rate started to rise, investors found other alternatives such as deposits and bonds, which yield a relatively good return, and without the risk involved in investing in growth stocks.



It should also be remembered that some of the companies entered the stock market with interested parties waiting to exercise their holdings, which were blocked for a year to a year and a half.

And when the block is released in one fell swoop to all stakeholders in companies that have entered into a housing estate in the last two years, it creates a wave of sales, which pushes down their shares.



To all of these should be added the investors' expectations in front of the companies' activities and their success or failure to develop a valuable product.

And in this context it should be noted that companies that are left with cash that allows them to continue operating can still surprise.



Eysure, for example, ended the trading day of last December 20 with an increase of about 280% after reporting good results in a cancer treatment study, and immediately published a prospectus for fundraising.

And here is an example that there is always an option for companies to fix a rising par."



We will remind that the value of iSure soared at the end of the first half of 2021, after joining trading as a dual on the American NASDAQ stock exchange, to about NIS 1.3 billion, and that even after the latest increase, it is a decrease of about 168% of the then record value until the day of her exam.

Anyone who invests in the capital market knows that after declines usually come rises, but this time the expectation of a correction may meet a recession (Photo: ShutterStock)

Correction or recession?

Lublin continues: "We are indeed entering a period where the macroeconomic data look a little better than expected, but we are also like the thread of the storm sliding into a recession that will further damage the companies' activities. After all, the economy is already experiencing layoffs, and growth companies are based on human capital, which is not cheap.



In addition, a return to a zero interest rate environment is not expected in the near future, and it should also be understood that the interest rate environment we have been in for the last decade is an anomaly, even if today we are in an extreme interest rate environment on the other side.



So companies that are in a higher risk profile, whether as a result of financial challenges such as a lack of cash, And whether as a result of a low value that will not allow it to recruit or anything else, solutions will not be found in the macro environment or in the expectation that it will improve in the foreseeable future.



However, this does not mean that the moment of their burial has arrived, as there are recovery scenarios such as some kind of game changer, as presented in Issure.

A unique development or a large significant customer or anything that signifies a significant change in some field or for some company can be a change.



In addition, if a company with capital finds interest in investing or purchasing a share of any growth company or its technology, due to its ability to be an advantage in its activity or correspond with it in synergy, it can be a referral in the company.



And for all that has been said, another variable must be introduced, which is the new generation of investors who entered the stock market in the last two years, who do not know what a high interest rate environment is or how to price companies in such an environment.

For some, a 90% crash in the stock of a growth company is not a substantial matter, but a passing thing whose correction is only a matter of time, since growth companies are constantly on the rise.



But this is not necessarily true and neither is the situation today.

The capital market, as we said, works in cycles, and the last cycle was indeed longer, but you can come out of it more experienced and wiser.



My view of investment management, for example, is that one should look at what is happening in the capital market with modesty, and understand that it reacts decisively to a negative macro environment, and generously to a favorable macro environment."

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Source: walla

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