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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 76.07

-1.1%

3:59 PM EST

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To: Ibexx who wrote (16416)	8/28/1998 2:10:00 AM
From: jach	Read Replies (2) of 77400

time to get out from csco; 30%+ margin will be extremely hard to maintain- reasons: 1. insider sales of significant amout recently 2. LU and NT with 10% margin will give strong competition 3. Glut of GBit switches/Layer 3 switch routers from all these startups are coming to mkt now; they all need to sell; see what happened to the low end ethernet switch mkt; one can buy a switch for 50$ at COmpUSA or FRYs; at this rate of competeition and chip technology standardization high-end boxes will come down to the 500$ to 1000$ level within a yr; pretty tough to have 30% net margin on a 500$ box 4. Efficiency of Web commerce now being duplicated by others 5. past history has nothing to do with future; being up for last 5 yrs do not necessarily mean that it will go up for the next 5 yrs 6. As many have deep profits already in, when csco starts the downturn many will bail out, and it will be much more severe than the mkt trend; imo, sudden drop of 5,10 to 20$ is possible Message 5577735

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