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To: John Malloy who wrote (12061)	1/5/2000 5:17:00 PM
From: GVTucker	Read Replies (1) \| Respond to of 21876

John, RE: Not so! In Post #30772 I reported a discounted cash flow analysis that showed an investor who insisted on a 12% after-tax return and who planned to hold Cisco for two years could afford to pay $138 for it. The analysis was based on the growth of equity/share gradually slowing from today's 53 %/yr. to 50 %/yr. in two years. That growth pattern brings equity/share to $13.81 in two years. I also allowed for the price/book ratio to slide to 13.8 by that time. That combination of equity/share and price/book ratio brings Cisco's price to $191 in two years. Your analysis, although certainly arguable, is not a discounted cash flow analysis. It is dependent on two factors not related to cash flow: earnings and book value.