High-flying cloud computing company Xero and Dunedin cancer diagnostic company Pacific Edge have had their wings clipped, with their share prices plunging to make them among the worst performers on the New Zealand stock exchange in recent months.
After being the sharemarket darlings, leap-frogging in market capitalisation by massive percentages, Xero has since gone off the boil and lost 47% of its value, while Pacific Edge was down 35.3%, as at mid-September.
Xero was trading at $15.85 yesterday and Pacific Edge 87c.
The third worst share price performer was Dunedin-founded A2 Milk Company, down 32.5%, and trading at 61c yesterday.
Both the shares of Xero and Pacific Edge, neither of which have posted profits, soared on the crest of a mini-tech boom which began late last year, with Xero outstripping Pacific Edge's more than $500 million market capitalisation to at one point hit $5 billion.
Yesterday, their market capitalisations stood at $2.02 billion and $277 million respectively.
The large, lucrative US market has been the focus for both, and prompted huge investor excitment for the companies' respective products, but months on, the sobering reality has set in of the difficulties faced in expanding their respective market shares beyond their credible beachheads.
Pacific Edge's share price took off after it established a US laboratory and staff, gained crucial regulatory approvals, clinched several patents and announced an impressive raft of contracts with US and other overseas health service providers, meaning they could reach potentially tens of millions of Americans.
Xero's roller coaster ride had prompted plenty of reaction from analysts and media, The New Zealand Herald reported.
But to its Xero's credit, and that of chief executive Rod Drury, the company had never been too interested in the share price.
Even as it was rising fast, Mr Drury maintained a steely focus on the company's long term growth strategy.
On that basis his relative lack of interest in the falls this year is easy to understand.
Others on the list include retail stocks The Warehouse and Kathmandu, both of which have battled tough selling conditions - like the warm start to winter - and ongoing challenge of social changes in the way people shop.
