Cisco Systems, Inc. (CSCO) Message Board

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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 73.99

+3.1%

3:59 PM EST

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To: Brian Malloy who wrote (28012)	8/30/1999 2:07:00 AM
From: Richard Nehrboss	Read Replies (3) of 77398

Whew.... I can't believe the response to my post on CSCO's high PE. Note: 1) I'm very long CSCO.. thousands of shares... No one wants this baby to continue to surge as much as I. 2) I noted that CSCO's PE was below 50 for most of the 90's. I didn't mention the 70's or the 80's when, as several of you have noted, the risk free rate was higher. 3) CSCO's earnings growth rate was 42.6% for the last 5 years and is anticipated to be 29.7% for the next five years by over thirty analysts who spend a good deal of their energy on the issue. 4) Ultimately a stock is valued by discounting it's future earnings... Anyone actually go through this little exercise? If so I'd love to see your analysis. 5) Earnings growth rate dropping 30%.. PE increasing by 200-300%. Risk free rate in relative stable range (relative to the first two). 6) Me thinks thou doest protest too much.. 7) I still think it's a great company, Chambers is a great CEO (maybe the best next to Neutron Jack), and am happy with the way they throw off cash like Rod Smith throws of tackles... I'm just questioning whether the greater fools have bid her up too much. Richard

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