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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 77.42

+4.6%

3:59 PM EST

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To: patron_anejo_por_favor who wrote (38679)	7/31/2000 2:06:46 AM
From: Uncle Frank	Read Replies (1) of 77398

>> That's one possibility. The other is that the balance sheet is tortured just enough each quarter to confess ".01 above analyst". As a long time student of Cisco, I'd like to propose a 3rd alternative. Cisco has installed management systems that allow them to easily perform trial closes during the quarter. As they fine tune their earnings projections, they communicate with the analysts, who modify their expectations accordingly. They undercall their potential by .01, and the analysts adopt it with a wink, knowing Cisco will beat it by .01 over and over and over again. As a result of the predictability of Cisco's earnings and their outstanding top line growth, they have become the darling of analysts and institutional investors. This is one of the reasons they have been able to gain and maintain a valuation that some critics deem excessive. That's my theory and I'm sticking to it <lol>. uf

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