Chris, your previous reference of there being no reason for the stock to be languishing here in the mid $4, while other stocks are soaring is a bit erroneous, in my estimation. I also realize that statement may be a composite depressive attitude brought about by the general market conditions. It seems to be morphing into a general attitude and the street is betting on it, as they hoard the cash and prepare their shopping lists.
What it all boils down to is tax-selling season taking place in a market that wants to blame everything on the Asian fiasco.
In actuality, Franklin has held up quite well.
A few examples for comparison of companies that had strong momentum price action going into October (both in and out of the CTI sector) and their relative performance over the past month of trading:
11/12/97 FTEL 5.19 TO 12/12/97 4.34 = 15% DECLINE
VOCLF 22.00 16.37 = 26% DECLINE
ICOM 8.00 6.44 = 20% DECLINE
SYQT 3.50 3.00 = 17% DECLINE
TXN 46.88 40.87 = 12% DECLINE
IOM 28.62 26.44 = 8% DECLINE
CPQ 58.00 56.31 = 3% DECLINE
MCDY 7.25 6.12 = 16% DECLINE
RECY 7.25 6.62 = 9% DECLINE
GW 8.06 5.75 = 29% DECLINE
PKD 14.31 12.56 = 12% DECLINE
NORT 3.31 2.25 = 32% DECLINE
The last three come from the Oil sector which has been one of the strongest sectors this quarter, average loss (w/examples shown) 24%
Take CPQ, TXN, and IOM all three from the tech sector, one of the weakest sectors in this last go around of selling , for an average loss of 8%
Then take ICOM, SYQT, MCDY, VOCLF, and RECY all having strong momentum going into November, all representing micro/small-caps and most closely representing Franklin's parameters, yet the average loss was
17.6%.
Add all three categories together = 49% for an average loss of 16% overall.
Granted it doesn't make for an analysis cast in concrete but it certainly gives you a relative snapshot of just how Franklin is holding up to others. Especially in the tech sectors.
Bottom line, the closing days of the 4th quarter is a very difficult time period to make any sense based on sound judgement. There are to many extraordinary events taking place to deduce any intelligent, concise, and rational conclusions. The funds are window dressing, people are scrambling in preparation of tax year adjustments, companies are cleaning house, Asia is in total turmoil, and the street is heading for Club Med and other spots of Hedonistic pleasure.
Look at the DOW over the past weeks sessions, a week ago Friday we were pumping high watermarks at 8209 (high tick), yet a week later someone pulled the stopper and we end up with 7838(close), a -5% haircut. The NASDAQ -6%, and the Russell -4%. Franklin lost only -3.5% in that same time frame.
Look at it another way, in terms of yearly progress.
The Dow is up 24.35% since 12/12/96, the NASDAQ is up 18.35%, the Russell 2000 is up 18.58 %, and Franklin is up a whopping 231%.
Any questions?
RB |
