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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 76.04

-0.3%

Nov 26 3:59 PM EST

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To: jim bender who wrote (11256)	12/30/1997 12:51:00 PM
From: craig crawford	Read Replies (2) of 77400

<< Craig & Eric, What are your picks for 1998? >> If I have to stick by my pick for the whole year I will have to give that careful consideration. I change my mind relatively quickly. One that is at the top of my list as a guaranteed winner in '98 though is YHOO. Short this and you can't go wrong. Just don't short so much that you get squeezed. Plan on shorting just enough so if it doubles from here you won't get squeezed out. YHOO is a total farce, trading at over 60 times sales. (C$CO is trading at 8 times sales if you were wondering). YHOO had about $49 million in sales for the trailing 12 months. Their market cap went up almost 3 times that just yesterday alone! YHOO is trading at nearly 800 times estimated earnings. 575 times annualized earnings. If YHOO tripled their earnings for the next 2 years they would still carry a PE over 60 and that's assuming shares outstanding don't increase and their stock price doesn't rise! There is no incentive for anyone to sell now because it's making new highs and there is a short squeeze. Nobody wants to pay capital gains on this stock for '97. They would rather wait a few days so they can push it out until '98 taxes. Also, shorts who have been killed on this one are buying in to get a capital loss. After Jan 1 this effect won't be on YHOO's side anymore. There was an article on MSNBC talking about the gross overvaluation of YHOO a few days ago. If I come up with any other inspirational picks I will let you know. I'm keeping my eye on AMZN. Another bloated stock due for a dose of reality.

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