F5 Stock Extends A 5-Day Losing Streak To A 30% Loss
Shares of F5 (FFIV) have closed lower in each of the last 5 sessions, a cumulative decline of 29.7%. That erased about $7.8 billion from the company’s market value, which now stands at about $18.4 billion. The stock closed at $324.55 on Monday, November 2, 32.4% below its 52-week high of $479.83 and 44.9% above its low of $223.99.
FFIV Versus The S&P 500
Returns for FFIV and the S&P 500 over the streak and the periods around it, all ending Monday, November 2 and including dividends:
| Return Period | FFIV | S&P 500 |
|---|---|---|
| 1 Day | -4.1% | -0.5% |
| 5 Days (Current Streak) | -29.7% | -1.7% |
| 1 Month (21 Trading Days) | -28.5% | -2.3% |
| 3 Months (63 Trading Days) | -21.3% | -2.3% |
| Year To Date | 27.1% | 11.2% |
| 1 Year (252 Trading Days) | 26.4% | 11.8% |
Is This Move About F5 Or The Market?
The market explains little of this: the S&P 500 lost 1.7% over the same 5 sessions, including dividends, against F5’s -29.7%. 4 other S&P 500 stocks are currently on losing streaks of 5 days or longer. Over the past three months the stock is down 21.3%, a window that includes the streak; over the other 58 sessions of that window it was up 12.0%.
Is The Business As Weak As The Stock?
On the fundamentals, revenue grew 9.4% over the last twelve months, against a median of 17.9% for S&P 500 Information Technology stocks; its operating margin is 25.0%, versus a median of 21.6%; and the stock trades at 25.3 times trailing earnings against a median of 30.5. The selling is hard to square with the fundamentals: margins above the median and a multiple below the median.
If the drop has you weighing an entry, resist buying on price alone. Our Buy the Dip screen ranks the marked-down names where growth and cash generation still hold up.
Weakness In One Name Should Be Noise, Not News
For a diversified holder, a streak like this is a data point. For a concentrated one, it is a hole in the plan. The difference is never the stock; it is the portfolio built around it.
Building that portfolio is what the Trefis High Quality (HQ) Portfolio does: roughly 30 businesses with the cash generation and balance-sheet strength to absorb a bad month, selected and rebalanced by rules. It has a track record of outpacing a benchmark that combines the S&P 500, the S&P MidCap 400, and the Russell 2000. Make the next streak, in either direction, someone else’s drama.