Here are 5 of the Worst Performing ASX stocks that will bounce back in FY27, and 5 that won’t!

This time last year, we looked at some of Worst Performing ASX stocks in the prior 12 months (the Dogs of the ASX) and judged which ones would bounce back and which ones wouldn’t. We thought we would do the same this year given we got 6 out of our 8 predictions right. We were wrong in predicting Monash IVF would continue to fall (although it is only up 12%) and that Propel Funeral Partners would rise, but were right in all our other calls.

So here are our 5 Dogs of the ASX that we think will recover in FY27, and 5 that we think won’t.

5 of the Worst Performing ASX stocks that will bounce back in FY27

1. Cochlear (ASX:COH)

We would’ve laughed at anyone saying Cochlear would be a ‘Dog of the ASX’. The company remains the global leader in hearing implants and fundamentals are strong. But the stock was hit by valuation compression, slower‑than‑expected procedure volumes in some markets and concerns about competition. It fell over 35% in just a single day with a bad trading update. Now, we acknowledge the issues are legitimate but they do not mean the business is broken. It is just that priced Cochlear for perfection and then reassessed.

But we think a bounceback is Highly likely. Cochlear has a dominant market position, strong R&D capability and long‑term demographic tailwinds. The hearing‑loss market is growing, the company’s technology remains best‑in‑class and hospitals and specialists are not switching providers. The share price decline is sentiment‑driven, not structural. Cochlear is one of the highest‑quality companies on the ASX. It will recover.

2. WiseTech Global (ASX:WTC)

WiseTech has its issues but we believe its fall is a classic valuation reset that has befell most software company. There are concerns over the power Richard White has, the price it paid for e2open and how AI could replicate its software – the latter is not hypothetical as it lost one of its largest clients that is moving to in-house software it picked up from an acquisition.

But ultimately, the company continues to grow revenue, margins remain high and likely will given its controversial move to axe 2,000 jobs. And most importantly, its logistics‑software platform is entrenched globally. We believe that WiseTech is one of the strongest technology companies in Australia. Its competitive moat is real. Its customer base is global. Its product is mission‑critical. The recovery may not take the stock back to its peak multiples, but the underlying earnings trajectory remains intact. WiseTech is a high‑quality compounder that has been repriced, not broken.

3. Xero (ASX:XRO)

Xero is one of the most embedded businesses in the Australian market and is making inroads overseas. There’s just no incentive to use competing software. Nonetheless, this company has been hit by the same forces affecting WiseTech. Growth has slowed from its peak, the company has shifted its focus toward profitability and market has re‑rated the stock accordingly.

Yet, Xero remains the dominant cloud‑accounting platform in Australia and New Zealand. Its customer base is sticky. Its international expansion continues. The business is cash‑generative and increasingly disciplined.
The market is now rewarding profitable growth rather than hyper‑growth. Xero is well positioned for that environment and we think a recovery is likely.

4. Temple & Webster (ASX:TPW)

Temple & Webster was a pandemic winner. Online furniture demand surged. The company scaled rapidly. But as the world reopened, growth slowed. Rising interest rates hurt discretionary spending. The stock’s valuation multiple collapsed. But it is not the case that the business collapsed, even if the thesis that it’d keep recording high levels of growth indefinitely collapsed – hence the fall in the share price.

Investors are forgetting that Temple & Webster remains a well‑run online retailer with strong brand recognition. Its capital‑light model gives it flexibility. The long‑term shift to online furniture retailing is intact. The recovery will track consumer sentiment and interest‑rate expectations. But the business itself is sound and it will rebound.

5. Gentrack (ASX:GTK)

Gentrack provides software to utilities and airports. Its decline reflects contract timing, slower project delivery and a broader sell‑off in mid‑cap tech. There has been no catastrophic operational failure – the revenue profile is simply lumpy.

Gentrack has a sticky customer base – utilities do not and cannot switch software providers easily. The company has been investing in product upgrades and expanding its footprint. The business is fundamentally sound. The share price reflects sentiment rather than structural decline. A recovery is plausible as earnings stabilise.

5 of the worst performing ASX stocks that won’t bounce back in FY27

1. Accent Group (ASX:AX1)

Accent Group is a rollup of footwear outlets. It is exposed to discretionary retail and so rising interest rates, falling consumer confidence and higher operating costs have all weighed on the business. Foot traffic has softened and inventory management has become more challenging.

We don’t think it’ll bounce back, at least not in a reliable or investable way. Accent Group’s recovery depends entirely on macro conditions: interest rates, consumer sentiment and household spending. None of these are within the company’s control. The business itself is not broken, but the cycle is working against it and until consumer sentiment improves, Accent Group will remain under pressure.

2. Beacon Lighting (ASX:BLX)

Beacon Lighting is tied to the housing cycle. Higher interest rates have slowed renovations and new builds and consumer spending has softened. But more than that, the company has faced margin pressure and slower sales growth. And so while a recovery is not impossible, we don’t think it’ll be in the near term. Beacon’s recovery is dependent on interest rates, housing activity and renovation demand. These are macro variables, not company‑specific levers. Again, Beacon is a strong brand with a defensible niche. But the timing of any recovery is uncertain.

3. Boss Energy (ASX:BOE)

Boss Energy is exposed to uranium, a commodity that has not reached its pre-GFC highs. Now, there are encouraging signs in the market and some stocks have reaped benefits, but this one has not. You see, the company has been hit by project delays, cost pressures and shifting expectations around uranium supply.

It would be one thing if Boss Energy was just a case of investors waiting for prices to rebound – as perhaps you could say any stock exposed to nickel is. But this is not one of those cases – even gold miners haven’t been immune from pressure if they have suffered from operational issues, just ask companies like Bellevue (ASX:BGL). This is story of a company needing to get its own ‘house’ in order, a prospect not impossible but one that has not happened yet.

4. Myer (ASX:MYR)

Myer has been fighting structural headwinds for more than a decade. Department stores have been losing relevance as online trading has intensified. The company has improved its operations, but the market remains sceptical about long‑term viability. The recent decline reflects weaker consumer spending and renewed concerns about the department‑store model.

And so while Myer has made progress by cutting costs, pivoting online and improving its balance sheet we don’t think it will bounce back. Too many structural challenges remain, particularly that the department‑store format is not regaining relevance.

5. Bapcor (ASX:BAP)

Bapcor’s collapse has been one of the most dramatic in recent ASX history. Its FY26 fall is over 90% making it the biggest All Ords collapse of the financial year…and the fall began years before. Governance failures, leadership instability and strategic misalignment between management and the board all contributed – we’ve written about that all before plenty of times.

Granted the automotive aftermarket is resilient, but (as is the case with many other dogs of the ASX we think won’t bounce back) Bapcor’s issues are internal, not external. The turnaround depends entirely on whether new leadership can stabilise operations, rebuild trust and restore margins. This is not a case where a rebuild is impossible, but it will be multi‑year rebuild given the credibility damage is severe.