Down 33% by 2024 — could the UK’s 2 worst blue chips crash the stock market this year?

I’ve been looking at the UK stock market returns for the past year and two FTSE 100 companies are jumping on me. Sadly, for the wrong reasons.

They are the two worst performers in the blue-chip index, both down nearly 33% over the past 12 months. But one year’s loser can be the next year’s big winner. So do they have a big chance of coming back?

I actually considered buying one of the stocks in September: an international sports betting and gambling company Have fun (LSE: ENT).

It caught my eye after jumping over 18% in a month following the successful Euro soccer tournament, as the results went in its favor.

Should I be happy to share?

Investors had another reason to cheer as gaming industry veteran Gavin Isaacs took over from CEO Jette Nygaard-Andersen, whose acquisitions had not yet paid off.

Thankfully, I didn’t part with my money. Although Chancellor Rachel Reeves did not strengthen gambling legislation in her Autumn Budget, Brazil and the Netherlands did.

Then on December 16, Australian regulators slapped Entain with money laundering charges and the stock plummeted. Its price has fallen by 33% in 12 months and 60% in three years.

I’m not a fan of the gaming industry but I see an opportunity here. The 17 analysts providing one-year share price forecasts have produced an average target of just over 955p. If correct, that’s a huge increase of more than 50% from today.

Entain has a huge opportunity in the US through its 50:50 joint venture with BetMGM MGM Resorts International. I don’t think President-elect Donald Trump is declaring the collapse of sports. The stock looks decently priced with a price-to-earnings ratio of 14.7, although it’s not very expensive. The yield is 2.83%.

Entain’s share price may move suddenly but with regulators always on the move, it could go either way. For gambling. Not me.

Will Spirax share in 2025?

The second biggest flop of the past year is a stock I would never have considered buying. Spirax (LSE: SPX) focuses on niche products such as industrial and commercial steam systems. It flies completely under my radar.

As well as falling by a third over the past year, Spirax’s share price has fallen 55% in three years. I’m glad I ignored you.

Sales have been hit by the global industrial slowdown, as declining Chinese demand affects the group’s Steam Thermal Solutions division.

Once again, analysts are happy. The 17 brokers offering one-year forecasts produced an average target of 7,825p, up 18% from today’s 6,630p.

Shares look expensive despite their recent underperformance, with a P/E of 21.46 times. That’s more than the FTSE 100 average of 15 times.

Most attractive is the group’s excellent record of profits, with 55 years of consecutive annual dividend growth. A true Dividend Aristocrat. Growth continues as this chart shows.

Chart with TradingView

Today the shares are forecast to gain a measly 2.6%, covered by 1.8 times earnings.

However, I am not sure. Especially when I see a total debt of £1bn. That’s pretty good given the £5bn market cap. Spirax should perform better in 2025 as some of its more profitable markets recover, but I think I can find better value in the FTSE 100 right now.