Even with the stock market reaching record highs in 2025, not all FTSE shares have had a great year so far. And three stocks that have seen a particularly large hit to their market-caps since January include:
There’s no denying that seeing close to half an investment get wiped out is painful. But intelligent investors look beyond the share price and dig into why a company’s in freefall. After all, the best buying opportunities often emerge from the worst-performing shares.
So are there any hidden bargains here?
Investigating the fall
Each of these companies operates in its own unique industry. WPP focuses on the advertising sector, Ultimate Products owns a portfolio of homeware brands, while Greggs is Britain’s favourite bakery chain. Yet despite this diversification, they’ve all stumbled of late.
With economic uncertainty on the rise, businesses have been pulling back on their advertising budgets. That’s a nasty headwind for WPP, which is only being compounded by the rise of generative artificial intelligence (AI).
This impact is also spilling over to the consumer. With elevated inflation and interest rates still squeezing household budgets, demand for electronics and home appliances isn’t very strong.
Consequently, retailers have reduced their inventories due to slow-moving excess stock in previous years. And Ultimate Products is subsequently experiencing a slump in new orders.
Greggs is also feeling the pinch. Higher wages, ingredient prices, and energy costs have all adversely impacted its profit margins. Management’s responded by raising prices, but consumers have noticed. And its reputation as a cheap on-the-go food source is increasingly being questioned.
Throw in the added disruption from poor weather conditions, and the result is a significant slowdown in growth paired with profit warnings.
Room for optimism?
While the short-term outlook remains bleak, these companies aren’t sitting idle waiting for the tides to change.
WPP’s been investing heavily in its own AI tools as a new product offer for customers. And once the advertising landscape starts to heat back up, the business could be well-positioned to rebound during a cyclical recovery.
Meanwhile, Ultimate Products has launched a strategic review of its supply chain and manufacturing activities. Management’s seeking to identify inefficiencies, hopefully unveiling opportunities to improve profitability and offset the impact of a softer market.
As for Greggs, the company continues to innovate. New product offers are resonating well with customers, its loyalty programme’s proving popular, and a new wholesale partnership with Tesco has opened the door to a new revenue stream.
Which stock do I like?
Out of these three businesses, Greggs is the most promising, in my eyes. Growth in its latest results continues to be elusive. However, with operational improvements being rolled out, infrastructure investments proceeding as scheduled, and inflationary pressures subsiding, a steady recovery could already be underway.
The firm still has significant execution risk, especially as management targets a total of 3,000 locations across the UK. But in the long run, I think this FTSE stock still has plenty to offer. That’s why it’s already on my watchlist.
