When hunting down the best shares to buy, often a good place to start is among the biggest losers. That’s because it’s the place most other investors aren’t looking. And as a result, it’s possible to stumble across some terrific hidden gems.
Over the last 12 months, two of the worst-performing shares across the FTSE 350 are Hilton Foods Group (LSE:HFG) and PayPoint (LSE:PAY), both falling 42% and 36% respectively.
So what’s behind the decline? And has a lucrative buying opportunity potentially emerged here?
Investigating the problems
These businesses are quite different. Hilton Foods is a British food producer and packager working with some of the largest retailers across the UK and Europe. Meanwhile, PayPoint offers a point-of-sale and cloud-based retail management solution for convenience stores.
As such, the companies have encountered starkly different challenges of late.
Hilton’s seafood segment’s hitting multiple headwinds from regulatory shutdowns and inflation-driven demand destruction following quota restrictions on fishing in the North Sea. And even though its primary meat business is chugging along nicely, an overall downturn in consumer spending has resulted in multiple profit warnings.
PayPoint’s situation’s a bit different, driven primarily by managerial missteps and operational disruption.
The group’s investment in open banking venture Obconnect has so far failed to keep up with performance expectations, dragging down profits instead of boosting them.
At the same time, InPost’s acquisition of Yodel resulted in many of PayPoint’s Collect+ partnered stores being temporarily removed from the delivery network due to integration challenges. And consequently, these headwinds have ultimately led to management warning that its target of reaching £100m EBITDA will take longer than initially expected.
With that in mind, it isn’t surprising that both these shares took a tumble.
A hidden buying opportunity?
Hilton Foods Group’s CEO stepped down in November, and while the search for a successor is underway, Mark Allen has temporarily taken over as executive chair. And with his extensive experience within the food and consumer goods industries, investor sentiment has started to improve.
As for PayPoint, the parcel network disruption was ultimately a temporary setback rather than a drop in demand. And the firm’s already started seeing parcel volumes recover.
Meanwhile, its core merchant solutions business has recently launched new e-commerce tools and remains on track to expand its merchant network to over 10,000 by the end of 2026.
There are, of course, still plenty of challenges for both businesses to overcome.
With multiple external headwinds surrounding Hilton, a turnaround even under an experienced leader like Allen could prove challenging. And with PayPoint’s parcel volumes recovering, the new three-year contract signed with InPost is far less favourable than before, with the company receiving a lower fee per parcel delivered through Collect+.
So where does that leave investors?
The bottom line
With strong execution, PayPoint could steer itself back on track and enjoy solid revenue and profit growth. But given its recent track record, that’s not a risk I’m willing to take.
By comparison, Hilton Food Group seems to be in much more capable hands. The company’s appointed two new operating officers covering different regions as part of a wider turnaround. And with a weakened stock price, it could be worth a closer look for investors seeking turnaround shares to buy in 2026.
