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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 76.39

+1.2%

3:39 PM EST

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To: Sonki who wrote (12770)	3/3/1998 6:57:00 PM
From: The Phoenix	Read Replies (2) of 77400

Sonki, Your numbers match closely with mine. However I'm a bit more optimistic short term. Yet, I also see more downside if PE's slip. calcuated csco target for yr july 2001 under 3 situations, crazy bull mrkt = 167. reasonable value = 117 <--- most likely. under heavy correction = $83. csco splits at 80 As I mentioned in an earlier post, Cisco will be at 100 prior to the end of the calendar year. Given current PE's...which I'll admit are high, (~50) if Cisco makes the year at $1.77/share they'll be 88.5 in July! So, I think if the bull we've got continues Cisco will easily make 100 before 1999. Next, As Eric points out Cisco is targeting new huge growth markets in the carrier space. If they have any success here whatsoever Cisco could see significant earnings growth on the order of 30% a year for the next 5 or more years. If PE's hold (i.e. the bull market we have continues) Cisco will be 211 by July 2001. (Note this number could easily be higher if Cisco really takes this market and see's higher than 30% earnings growth.) Generally going forward the market in the telecom space could be even crazier bullish....exciting to think about. However let's look at the reasonable scenarios. Cisco makes 1998 at 1.77/share - Stock Price July 98 = 90 Cisco's PE slips to 40 by July 01. Cisco sees 20% earnings growth in 99, 00, and 01 Cisco Stock price July 01 = 122 Best Case... Cisco at 200+ at mentioned in the paragraph above. Worst Case PE Slips into the low 20's by July 01 (market correction) Cisco at 70 by July 01. YUCK! Gary

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