How do we know when to leave a Franchise alone?

How do we know when to leave a Franchise alone?

The big dilemma of cinema is that the studios always want to make sequels, prequels etc

But how do we know when enough is enough. It's always a bad idea to mess with a classic.
Some film franchises can last a long time. Some end in their prime.
The truth is that the more you milk a franchise, the worse it gets.
Take for instance, horror franchises such as the slasher films of the 70s and 80s.
Franchises like Friday the 13th and Nightmare on Elm Street. They were given so many sequels that eventually they just got ridiculous. Luckily there were some different things thrown in there as well such as New Nightmare and Freddy Vs Jason to keep the interest.
Now in some circumstances, a franchise can never die, and more is better. Although the only franchise this has ever been the case for is 007. Which gets stronger the longer it lives because it's updated and fit with the new times and technology. The Roger Moore Bond's were very new in the 70's yet now, we can't compare the visual wow of Daniel Craig's Bond to the older ones.
Nowadays, any more than a trilogy and you're bound to get sloppy. Sometimes, even after a crap sequel, you get a surprisingly good one.
But more than often you get well loved movie franchises that get a disappointing sequel (Such as Pirates of the Caribbean, Terminator etc)
What are your thoughts on this topic? What should be the cut off point for movie sequels? Comment below!