IF csco misses and comes in with .34, lookout below. Very unlikely IMO.
Yes, monkeys more likely to fly out my ....
Seems like almost a foregone conclusion that they'll come out with at least .35, and probably not much more (even the biggest optimists seem to be saying .38), as they manage expectations so well. So: does it really matter? Are .35 and .38 so far apart that the stock price should (I didn't say "will") be greatly affected?
The near-term stock price is much more likely to be affected by market psychology than by the quarter's results or the CC. The results will be fine, for some value of "fine", and the CC will say that long-term prospects remain good, that the market is growing explosively, but that competitive challenges remain and are likely to intensify, that CSCO will have to remain vigilant, that margins are likely to come under pressure in some sectors, that a downturn in the world economy could dampen growth rates, and so on until you're sick of listening.
Then, at the end of the day, you have a company that is dominant in a fast-growing market, and that has a stratospheric P/E, even based on rosy forward earnings projections.
If the market focuses on stratospheric P/E, margin pressures, and competition, CSCO goes down. If the market focuses on "dominant" and "fast-growing market", CSCO goes up.
My guess (and this is really like guessing what your cat will do next) is that a 3:2 stock split, a very good quarter, and a rosy forward outlook have already been priced into the stock, and that we're staying flat or dropping a little, near-term. Remember this guess is worth what you paid for it. We'll know soon enough. |
