Cisco Systems, Inc. (CSCO) Message Board

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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 74.32

+0.9%

Jan 22 3:59 PM EST

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To: Stock Farmer who wrote (56716)	1/16/2002 11:40:55 AM
From: RetiredNow	Read Replies (2) of 77400

Might I weigh in a little here? I'm thinking that a war of semantics is really all this is. At the end of the day a company can choose whatever financial structure they think puts them in the best light with shareholders and with Wall Street. Some companies choose to rely primarily on debt financing. Others choose equity financing. Usually, most companies are trying to keep return on equity and invested capital high. Sometime leverage helps. Sometimes it doesn't. I think what is clear is that Cisco has chosen to go the equity financing route in a very big way. As a result, they have boxed themselves into a corner. Now, despite being a tremendously powerful franchise with an enviable balance sheet and cash generating ability, their stock may continue to be stuck in the doldrums because of that HUGE outstanding share number. So I propose that we discuss the outstanding shares as the real problem as opposed to the semantics of whether equity financing can be considered a loan to the company from shareholders. Just my 1 cent (I've lost 50% of my opinion in this recession).

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