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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 73.42

-2.4%

Jan 20 3:59 PM EST

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To: t2 who wrote (57359)	2/8/2002 12:56:58 PM
From: RetiredNow	Read Replies (1) of 77400

hmm. Not exactly. When an employee exercises options, Cisco gets a tax benefit, which helps operating cash flows. When Cisco repurchases stock, that affects the financing section of the cash flow statement. So it's not apples to apples. Also, Wall Street and I both certainly do buy the strong cash flows story. John is the one that doesn't and he has proven conclusively that Cisco has benefited dramatically from options exercises in the past. What has yet to be proven is that in the two most recent quarters, Cisco is benefitting to such a large extent. The reason why this is important is because it goes directly to sustainability. Can Cisco continue to generate so much cash from operations or when the stock stops growing, will that cash flow shrivel? Very relevant question. When I have more time and when we get this quarter's 10Q, I'll look into it.

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