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Technology Stocks : Cisco Systems, Inc. (CSCO)
CSCO 76.95+1.2%3:59 PM EST

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To: Uncle Mikey who wrote (9830)10/27/1997 11:25:00 PM
From: James T.  Read Replies (1) of 77400
 
Here my opinion. Don't sell COMS, and buy more, and wait until CSCO drops more, and buy more of CSCO.
Look, as of today the following holds for COMS, and CSCO.

CSCO
Earnings per share is 2.05 and will be 2.16 next quarter (expected).
This gives it a CURRENT P/E of 36. The bad news is that it growth is only expected to be 27% by the end of this fiscal year, and 25% the next year.
ooohh, a reducing year-to-year growth rate, and a much larger PE than its growth. Makes me worried. That is a small portion of why I expect it to drop more at which point the price might just get attractive enough to buy more.

COMS
Earnings per share is 1.86 and will be 1.89 next quarter (expected).
This gives it a CURRENT P/E of ONLY 23.
The good news is that it is expected to grow 28% by the end of this fiscal year, and 31% the next year. Check it out, the P/E is lower than the growth. This is good; at least I think so.

I'd prefer to buy the undervalued stock, COMS, and sell the overvalued stock CSCO.
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