CSCO - A GIFT - which most money managers flock to:
I did some research and presenting the numbers below ... I see a beautiful trend emerging:
Earnings:
date______cents/sh______revenue
02/04/97---51--------74.2%
05/06/97---52--------51.6%
08/05/97---55--------36.6%
11/04/97---59--------30.88%
02/03/98---43--------27.0%
05/05/98---45--------32.1%
08/04/98---48--------35.4%
If you observe from 11/04/97, revenue is accelerating steadily and Aug'98 quarter saw a 3.3% revenue increase vs. the Aug'97 quarter, which was actually down 15% from the previous quarter; i.e. 18.8% positive reversal this year compared with last, which is the basis for Mr. Chambers statement that "... we tackled Asia very well and increased revenue ..." and also took a lot of business out of 3COM, NN, Bay and CS, when he further said " ... took a lead over competitors ...".
What a fantastic turn of events at the expense of 3COM. Also, people
became cautious last week about 3COM, when it openly said about only
"small and mid tier ..." business support. The question in everybody's
mind was: What about their Enterprise strategy? What about scalability? Thanks Lord that Cisco is here so we do not have to worry about these issues, while we tackle our Y2K problems!
All this superb revenue growth, despite a cautious outlook given by Mr. Chambers this last May, that Asia may affect them! But it didn't because of their lead, business skills and planning ahead. This shows how conservative the CEO is in his talk, but keeps on delivering much more ... (and now he is really bullish ... you get the idea); hence, analysts have no way except to keep on increasing their price-targets quarter-after-quarter, year over year ... and resultantly, MMs have no way except to keep on loving this stock and whenever they want to play on the long-side, CSCO is the first to enter their neurons! A simple, sleep-well, long strategy, imho!
cheers,
-/Sonny. |
