The 19-year-old has suffered a shoulder injury out on loan, which could derail his season.
At 19, Ballard secured a loan move to Blackpool in League One following an impressive stint with Reading last season.
The Saints boss told the Daily Echo: "I found out this morning actually from our medical team and I am really disappointed for Dom.
"He had a good start to life there and through the manager change. He's a great kid, I know he'll attack his rehab in the same way he did last year after a big injury.
"This can happen, everyone's journey is so different and Dom was on the ascent here and getting really close and then he gets an injury out on loan.
"Then has to go out on loan again and just things can happen and change so quickly in football. We'll touch base with him today.
"I know the medical team have already spoken to him and the Blackpool medical team. It might mean he needs to come back here for a bit to get his rehab done.
"Or he'll stay there, we'll decide what's best for him and where he's at right now but I've got no doubt Dom will come back stronger and better than he did previously.
"He did with his last big injury. Football and life are not fair sometimes but he'll choose to either suffer and feel sorry for himself or he'll choose to use it to come back better.
"Of course, he'll feel the disappointment and the hurt - we all will for him - but I've got no doubt what choice Dom will make and he'll be more than fine long term.
"It's just another small setback for him. How long he is out depends if he needs an operation or if they'll heal it naturally.
"No operation gets you back quicker but then there's a risk of redoing it so they'll decide that all together and then once they've made the decision I'll speak to him."