2 things that are important to note:1) technical analysis works...

2 things that are important to note:

1) technical analysis works best when you tie it in with fundamentals. It pains me to see so much technical analysis jargon being thrown around the press without any corresponding fundamental analysis. There are many ways of looking at a picture. If you provide a chart to a group of people, you will get varying responses. That is a given. The best technical analysts out there are the ones that tie it in with fundamental analysis.

2) FGE just purchased a company for 0.8x to 1.1x EBITDA up front. Yes, if you include the ongoing payments, it works out to be 1.9x to 2.5x EBITDA. As to why people think this is not great, is beyond me. This will definitely lead to EPS growth and an earnings upgrade. No matter how you cut and dice it, this is a good transaction. They only had to pay $16 million up front. As for the selling on market, I believe comments from CLO (according to one of the posters on this forum) are unprofessional and mediocre. I wonder how they can state mid $5.50 were high prices to purchase FGE. According to Citigroup analysts, FGE should have a NPAT of approx. $45.8 in FY'12. This was their research piece in late August 2011. Since then, at the end of 2011 Citi have further stated that earnings risk lie to the UPSIDE. This was all before the recent CTEC deal. The CTEC deal should provide even further upside. Anyway, I think you get the point. In my opinion, FGE is probably trading on a P/E of approx. 8.5x FY'12 with an even lower P/E multiple in FY'13. The discount to their peer group is not warranted as FGE has constantly excelled in the past.

As for the selling you are witnessing on markets, it will be due to profit takers & technical traders. Long term fundamental value is still in the stock. FGE's management have stated they will provide markets with an update post acquisition. It should happen in the next few weeks (maybe with their 1H results). There should be some commentary soon.

There are many retail shareholders who will sell now on the back of a single headline. Benefit from those retail shareholders who are selling. FGE will re-rate to a multiple in line with peers.

That's all for now & happy investing.