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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: Stock Farmer who wrote (57302)2/7/2002 5:11:24 PM
From: RetiredNow  Read Replies (3) of 77400
 
Hi John, welcome back. I have a few rebuts to your assertions below.

"On the whole inventory thing. Nifty trick (er, co-incidence) that the inventory benefit to GAAP offsets the writeoffs and chargebacks to Pro-Forma. GAAP = Pro-Forma so whichever truth you go by gives the same nice $0.09 answer, right? And nothing up the sleeves either ;) Sustainable? No."

They don't like it when you use Proforma and they don't like it when you use GAAP net income. Go figure.

"Balance sheet positive. More cash than generated by the business. Smells like stock option contribution still contributing. Sustainable? Um... depends on the stock price trend <ng>"

Well, I'd believe it if the price were going up. That was the argument you made as the stock rose to unsustainable hights. However, the stock has been in a steady decline for two years now. Options exercises have got to be much less than they used to be, so I doubt that it's making quite the cash contribution you think it is. Unless, you have evidence to the contrary?

"Did anybody else notice no amortization of goodwill?..."

Easily explainable. In the days when Cisco was acquiring like mad, they used the pooling method, which as you know means no goodwill was recorded. So Cisco won't have as much goodwill to write off as their competitors like Nortel who always used the purchase method.

The rest I grudgingly agree with.
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