KyrosL, the truth behind Cisco is becoming more apparent with time, which is their greatest enemy. In January of this year two very respected journals, Barrons & Fortune, manifested how Cisco had lost close to $2 billion and how they were able to use fancy accounting to cover up their losses. Since then not a single member of Cisco's Board of Directors has rufuted any of those articles. Hence we would be foolish to believe otherwise. Now, if Cisco was losing money in a good economy, how are they going to cover up their losses with a slowing economy? Especially when they are clearly losing market share in their core areas.
Remember, Cisco is an acquisition machine, not a self developing tech. company. Most of it's technology was acquired through acquisitions, whereas 3Com has developed most of it's own technology. That is why 3Com is the clear leader in patent registration in the Networking sector.
With Cisco having lost 80% of it's currency in the latter 6 months, it is going to be interesting to see what kind of currency and how well accepted their currency will be in their next foray of acquisitions.
With the abolition of "pooling of interest" this coming summer, Cisco is going to have to make real earnings, disclosing their true costs, hence manifesting weather they really made earnings. Couple this with their loss of market share in their core businesses, inventory build up, a brain drain, lower margins on their products and slower than expected growth in the telecom sector and what you have is a recipe for disaster. |
