Jach,
Wouldn't your same logic say that Microsoft was overpriced ... always? After all, by revenue numbers, and per share earnings, Microsoft has a market cap of more than Cisco, Lucent, HP, Sun, and CPQ combined!
Once again, the market clearly feels that Cisco's long term earnings potential is greater return on invested capital than HP, Compaq, Sun, Lucent, etc.
Flat Revenue and Earnings numbers do not tell the whole story. If you think they do, then you are grossly oversimplifying enterprise valuation.
Jach, here is an exercise: why not compare GM and Ford's revenues and earnings to Lucent and Cisco. Let me know what you find out.
- Adam |
