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Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: telecomguy who wrote (7363)	10/23/2000 4:09:21 PM
From: Ian@SI	Read Replies (1) \| Respond to of 14638

Agreed, if the company increases the rate at which it spins off free cashflow, the shareholders will ultimately benefit. usually fairly quickly. Market seems to be rethinking the multiple it will award CSCO. This might me the first year that its shares haven't at least doubled for as long as I've known the company. And if its currency becomes less richly valued, it will be more difficult for it to continue doing accretive acquisitions in this sector. No sign of that being imminent. ...yet. FWIW, Ian.

To: telecomguy who wrote (7363)	10/23/2000 4:14:38 PM
From: RetiredNow	Respond to of 14638

Well said.

To: telecomguy who wrote (7363)	10/24/2000 8:45:24 PM
From: synnful1	Read Replies (2) \| Respond to of 14638

CSCO is death, the stock will go down to 40. Most of there earnings are from investments. They also finance the people who buy there products as well as extend them loans to get there network systems going. Perhaps most importantly they have no remedy for the dilution the issuance of stock options to there employees. Good luck. Finally read smart money articles, such as Grants interest rate observer even though the barrons article was accurate. There opinion is worse than mine.

To: telecomguy who wrote (7363)	10/24/2000 11:41:07 PM
From: Perspective	Read Replies (2) \| Respond to of 14638

For those of you that think that CSCO's cash flow is great, I would ask you to actually go read their cash flow statement. When I did, I was shocked. I genuinely thought this whole vendor financing thing was hugely overstated by the bears, but the answer came to me, and it was quite simple: if vendor financing is truly a significant portion of CSCO's earnings, then their cash flow should be far less than income. If cash flow matches or exceeds income, then vendor financing is a non-issue. They are getting paid cash. Period. So I perused the cash flow statement. Dug down to the bottom line. Computed cash flow per share, and it was nearly equal to earnings per share. Case closed, right? Wrong. I then noticed that a huge chunk of their positive cash flow was NOT from operations, but from option exercise proceeds. Their cash flow from operations is nowhere near their earnings per share, meaning that they are likely dependent on vendor financing for a significant portion of their "sales". The reason I call it "sales" is that they are exchanging hard assets not for money, but for very questionable equity. Their price-to-cash flow from operations was more than DOUBLE their price-to-earnings over the first nine months of the year. Please have a read, and let me know if I've missed something. I genuinely want to be correct on this. Message 14271988 BC