Bob,
THanks for the trip through history. A couple of points. First it should be no surprise that revenue growth as a percentage has slowed. As the numbers get bigger the percentages will shrink. In dollars however revenue continues to accelerate. In fact CSCO now grows revenues at more than $2B annually, more revenue than most (if not all) of CSCO's traditional datacom competitors generate for their entire fiscal years.
Second error in your analysis. And, this is information provided by many analysts as the basis for continued accumulation - that is, growth prospects. With convergence CSCO is poised to grow to a $20B company by FY 01 - perhaps even more. Valuations are no-doubt based, in part, on future expecations, not past performance (even though CSCO's past performance has been excellent). Analysts see CSCO doing even better going forward as networks (data, voice, cable, etc.) move to packet based environments - and who is the king of packet based networks. That's right - CSCO.
So, sure, as this company grows, percentage growth rates will decline. THis is math 101. But make no mistake, CSCO is the dominant player in a market that is poised to explode with data/voice convergence, internet access at increasing speeds, video on demand, etc. etc... and we're only scratching the surface here in the U.S., we havn't even begun overseas...and when those markets come back (where CSCO is investing now), you'll be wishing you owned this pup.
OG |
