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Technology Stocks : Cisco Systems, Inc. (CSCO)
CSCO 75.19-0.1%Jan 16 9:30 AM EST
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To: Wyätt Gwyön who wrote (54401)8/8/2001 3:25:04 PM
From: Jacob Snyder  Read Replies (1) of 77400
 
the consensus PE on 02 earnings at 111.

You will be too pessimistic, if you use trough earnings, for a cyclical company, to guess what a reasonable valuation is. Just as almost everyone was too optimistic, using peak cyclical earnings (and extrapolating them linearly into the future), during the Bubble.

Using the mid-point between trough and peak earnings would be a reasonable way to do it.

However, I agree with mindmeld, that using cash flow is better.
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