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Technology Stocks : F5 Networks, Inc. (FFIV) -- Ignore unavailable to you. Want to Upgrade?

To: Conan who wrote (1338)	1/1/2001 11:33:03 PM
From: Analog Kid	Read Replies (1) \| Respond to of 1801

Good to hear from you Conan. I'm really disappointed with what happened, I really thought this was a potential CHKP. As far as CFLO, I have never researched them carefully because I will not consider any company until they've proved to me they can go earnings positive (or in this case "cash flow" positive :) I guess we have to accept a substantial failure rate when hunting for 10-baggers among small rapidly growing tech companies (actually, the payoff will be much larger than 10-bagger if we identify them at this early a stage.) I guess an alternative strategy is to wait until they hit midsize to invest (in which case we can expect a 10-bagger over maybe 3-5 years), since the process of going from small to midsize weeds out many of the companies that don't have the right stuff. Or then there's the "Gorilla Game" strategy of starting out with all the companies in an emerging space and then making adjustments as a winner emerges. Or we can keep trying as we have been, and take the loss when we're wrong. This incident with F5 has shaken my confidence a little bit, and made me realize how much luck was involved in my CHKP triumph. Of course if we weren't in a deep bear market we wouldn't have sustained as giant a loss with F5 as we did. I am now thinking: how could we have seen this in advance? Were the signs evident? I don't need someone telling me that the price action forecasted this blowup - in 97-98 CHKP plunged from 50 to 12 and I hung on and kept buying as much as I could. At least we have the quarterly financial results, which gives us a 3-month precision in finding out when things are going wrong, but is there are a good way of reducing that time period further that we can apply in the future? It looked like they were executing a good plan and had a huge installed base - I still don't know if their sin was their inability to forecast the general slowdown in demand, or if they are losing sales to competitors. If anyone has any insight on this I would love to hear it. Learning how to do this would be priceless. I guess those with good connections with resellers might find out things early. I do read InformationWeek regularly and I feel I get good timely information on company and industry trends. Good luck AK