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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Stock Farmer who wrote (51162)	4/6/2001 10:18:43 AM
From: RetiredNow	Read Replies (1) \| Respond to of 77398

It sounds about right. Except, I don't see it like you do. Cisco is still making money, and lots of it. They are a positive cashflow company, so their cash and investments hoard may fluctuate with the markets, but they won't go have to borrow money to finance operations, because they are still making money and their margins are incredible. Check out their last 4 quarters performance: Apr-00 Jul-00 Oct-00 Jan-01 Rev 4.919 5.782 6.519 6.748 13.1% 17.5% 12.7% 3.5% Inv 0.878 1.232 1.956 2.533 26.3% 40.3% 58.8% 29.5% A/R 1.900 2.299 2.887 3.512 11.0% 21.0% 25.6% 21.6% OperCFL 0.629 1.621 1.363 2.826 -76.8% 157.7% -15.9% 107.3% So what I see here is tremendous topline growth that is ebbing due to the market. Increase in Inventories due to component shortages and their erroneous belief that the market was going to continue to expand. And an increase in A/R as a %age of revs due to entering SP market and mounting bad debts. So their financials have deteriorated. However, they are still bring in more cash than they spend every quarter. With the current cost cutting and layoffs underway, they will STILL bring in more cash than they spend every quarter. This company is a POSITIVE CASH FLOW company. They WILL NOT be going bankrupt any time soon. The entire Internet and networking market would have to disappear overnight for Cisco to go bankrupt. This simply is not going to happen, despite what the crazed critics on this thread think. Stop panicking everyone. It's not the end of the world. A year or two from now, this will all be a bad memory and you will be basking in a double or more on the stock you are purchasing now.

To: Stock Farmer who wrote (51162)	4/6/2001 11:54:28 AM
From: elmatador	Read Replies (1) \| Respond to of 77398

I'm trend impaired. So "if business doesn't get better than it was during Nov, Dec, Jan (oops), cash on hand dries up around August." Now suppose "Business DOESN"T improve in 2H". What the options could be? OK, they can 'refuel' as you explain. Now suppose raising cash in 2H becomes really tougher than expected, what then? Would CSCO be forced to cut down the workforce further? I would appreciate your thinking under this perspective.

To: Stock Farmer who wrote (51162)	4/8/2001 2:03:27 AM
From: john dodson	Read Replies (1) \| Respond to of 77398

John, Point taken. No matter how big the cash pile, it can't last forever if it must sustain the company in the face of neverending deterioration. However, I do not particularly subscribe to the neverending part. But one never knows. Besides, no CFO would let a company burn its cash reserve to extinguishment with other options staring the company in the face. CSCO's already frozen acquisitions, which admittedly are mostly financed as stock swaps, but they've also done some symbolic cost cutting. Not to mention the fact that the company is still pretty profitable. Actually cash+equivs and short term investments, which are nearly as good as cash, were about $4.78 billion at Q2/01's end, down about $1.6 billion from the previous quarter. However, one quarter does not a trend make. Case in point, Cisco's history of closing cash+sti numbers: q/yr - Total Cash+STI (millions) q2/01 - $4,782 q1/01 - $6,391 q4/00 - $5,525 q3/00 - $4,653 q2/00 - $3,698 q1/00 - $1,765 q2/99 - $1,851 q1/99 - $2,307 My main point was simply that CSCO has more than enough cash to weather a pretty sizable storm. And as you mentioned no debt and relative financial strength compared to competitors. Question is how much cheaper will it get? I don't claim to know, but I do know that it's cheap enough for me to continue nibbling on. Good luck! -John