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Sometimes you have to wonder. As an analyst for the Automobile After-Market, I am compelled to take note of industry news. And so, the FLKI Press Release pointedly released to the public after the market close on Friday was on my desk seconds after its release (Major Board Appointment Promises Substantial Momentum in FLKI Growth ). The release begs the question: Why would an albeit small company (market capitalization barely $ 20 million at Friday’s closing price) whose fundamentals leave no room for criticism in the opinion of most analyst including yours truly await market close before releasing outstanding good news? It’s come to that in these days of mass confusion. The gems in the market, good companies, seem embarrassed or afraid of releasing good news - their share price may pop up too fast they fear and with it expectations for short term objectives anathema to progress for a fundamentally based entrepreneurial business. Take the only release this past Friday concerning my industry. There President and founder Helle Madso of Falken Industries – best known for the company’s Clean Plus® product conceptions, seems almost embarrassed that a mega buck master financier and industrialist would be willing to give of his time and expertise to her company, a company she says has yet to be discovered by the investment banking community. Well Ms Madso, let’s leave well enough alone and don’t worry about the investment bankers! In the 52 weeks just past with its stock suffering the merciless battering of the “crisis”, the company that no one seems to know managed to provide a return of 1900% for shareholders of record, a family which currently counts up to nearly 4000 strong. Granted the company will not prove of interest for the day trader since its history of volatility demonstrates two or three major swings in the market each year with each swing finishing on a higher close. The first of these swings provided short term investors with an 890% increase – putting the company first on CNN’s list of best companies - before crashing down from profit takers to establish a significant bottom at .19 cents. The second of these swings in 2009 made a profit for short term traders of 390% and the third swing of the year returned a late trade profit in early January of 40%. Now while there is no joy for the typical non-pro day trader if he cannot spend his life on chat boards enriching the pockets of brokerage firms on statistic showing losers toping winners by a healthy 1080 : 1, it seems to me that a “trader” on a rotation of three pulling down profits of 890%, 390% and 40% ought to be very happy. But what about the investor, the guy or girl that will put their chips out and check on it in a year or so, well at least on this unknown company, if history repeats itself in the forthcoming year, they’ll have to settle for a miserly 1900%. FLKI’s new director will assuredly facilitate the passage of this entrepreneurial company to that of a major corporation. It is also possible, and likely that this appointment is consistent with press releases past where the company announced a new policy of growth by acquisition. Big guns like this one don’t come on board a company of this size without purpose or motive. Unfortunately the market has so set itself that the better companies tell us nothing good except in passing at the close of a Friday, leaving the weekend to bury the news in a flutter of prospective “good news” announcements timed to surface at the opening of the markets to feed the appetite of day traders for fractional penny stocks. This leaves us in a quandary. Has the market turned entirely contrarian? Do we – should we - read opening market good news as fodder for the unwary? The feeling seems to weigh in favor of the latter. Good companies, the small companies with a real business, real potential, and steady solid upward motion with or without a rotation styled to spike investor interest at the expense of day traders, seem to be establishing a pattern in press releases favoring an effort designed at satisfying the disclosure requirements and crossing their fingers that the herd will not, on the news, stampede its stock. Timing is now a component of press release consideration. Is that any way to run a business?
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