Beleaguered grocery play Morrisons (LSE: MRW) took the fight to its cut-price rivals once again this week by announcing more price shedding across its lines.

Still unable to mount a fightback at the tills, the Bradford chain plans to reduce the cost of almost 160 products as part of its ongoing Price Crunch strategy. The latest round of reductions will see prices of “essential” meats tumble by 12%, a key battleground for Morrisons given that animal products are among the most expensive items in shoppers’ trolleys.

Although such moves are required to slow the momentum of German low-price rivals Aldi and Lidl, a continued programme of price cuts to entice shoppers isn’t sustainable for Morrisons’ bottom line — the business has reduced the cost of 4,435 products so far in 2016.

Besides, there’s little evidence that Morrisons’ manoeuvres are drawing food shoppers back through its doors. Latest data from Kantar Worldpanel showed takings at the firm down 1.8% during the three months to 14 August, nudging its market share 20 basis points lower to 10.4%.

Morrisons needs to show it has more in its locker than mere price cutting to put to bed its earnings troubles, particularly as a weak pound is likely to exert extra pressure on margins in the coming months as  the costs of food imports increase.

Morrisons currently deals on a forward P/E rating of 19.8 times, sailing above the generally-regarded watermark of 10 times indicative of high-risk stocks. I reckon this represents spectacularly-poor value given the supermarket’s poor turnaround prospects.

Dicey digger

A patchy revenues outlook also makes BHP Billiton (LSE: BLT) a gamble too far for sensible investors, in my opinion.

The stock price has jumped by a third since the turn of the year, a backcloth of recovering iron ore and oil values bolstering market appetite for the raw materials mammoth. But I reckon BHP Billiton’s ascent is built on rather shaky foundations.

UBS commented this week that “we do not believe the iron ore market is fundamentally tight as port stocks are high, supply is lifting (new additions [and] idled high-cost capacity returning), and steel output is only up modestly.”

Indeed, the broker expects iron ore to retreat back to $50 per tonne in the fourth quarter, away from recent levels around $60, with Chinese steelmaking activity predicted to moderate in the next three to six months.

BHP Billiton sources more than a third of total earnings from this one market. But this isn’t the company’s only problem — a steady build in the US rig count threatens to put crude values back in a tailspin; copper capacity continues to build; and decarbonisation initiatives the world over are smashing coal demand.

Given the prospect of fresh pressure on commodities values, I reckon BHP Billiton is in danger of a significant retracement, particularly given its currently-huge forward P/E ratio of 27.4 times.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.