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

To: RetiredNow who wrote (53207)	5/20/2001 9:05:53 AM
From: RetiredNow	Read Replies (2) \| Respond to of 77398

We Built this City on Broadband US home broadband access was up 134% between April 2000 and April 2001, from 6.8 million users to 16 million. According to Nielsen//NetRatings, the top five metropolitan areas in terms of cable modem, digital subscriber line (DSL), integrated services digital network (ISDN) and local area network (LAN) access account for more than 30% of all users in the country.10.2% of users live in New York City, 5.9% in Los Angeles, 5.8% in San Francisco, 4.7% in Boston and 3.6% in Seattle. US Web Use Grows across the Board Jupiter Media Metrix reports that internet usage increased among all age groups in the US during April 2001. Overall web usage grew 19% from April 2000. The greatest percentage gain came in the 55-and-over demographic, which was up 33% for the year, while the number of 18- to 24-year olds online was up 32%. Even with those gains, though, 25- to 34-year-olds remain the largest age group online. emarketer.com

To: RetiredNow who wrote (53207)	5/20/2001 9:08:43 AM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 77398

mindmeld, it seems to me you have barely scratched the surface of something. do you have any idea how much money the mobile carriers are losing? do you have any idea how much money they spent at 3G spectrum auctions in Europe last year? do you know what the debt loads of these carriers are? do you know what the average spread of telco junk bonds to Treasurys is, and do you know how large a difference there is between the telco junk spread and the nontelco junk spread? do you know why such a difference exists? do you know the ARPU and penetration assumptions necessary to provide positive profitability projections for north american carriers? these are just a few questions you might ponder. lastly, do you know who the UMTS Forum is?

To: RetiredNow who wrote (53207)	5/20/2001 12:56:27 PM
From: Stock Farmer	Read Replies (1) \| Respond to of 77398

Mindmeld - Good data. But it merely says there is a market out there, and does not quantify the potential benefit CSCO could reap or relate that to the present price of a slice. Which is what is required. Let us take this to ground. 16 Million wireless internet subscribers in 2010. How much does this help. We assume purchasing CSCO now for $20 and selling it in 2010 for at least our target profit. In 2010 we can assume bubbles evaporate, Cisco is very big, and CSCO will have a PE of approximately 20. The silly breakeven hurdle competes against a $20 bill in a safe deposit box and that is EPS in 2010 of $1.00 in 2010 dollars. The T-bill breakeven hurdle is EPS in 2010 of $1.70 (= 1.00 @ 6%) An equity breakeven hurdle of 15% is EPS in 2010 of $3.50 Follow the money. Let's assume these subscribers pay $50/month in 2010 dollars, that's $50 x 16 M x 12 = 9.6 B$/year. Or you can use the article's revenue, which was a bit lower. Let's use this higher number. How much flows to Cisco? Let's be generous and disintermediate the service provider and the entire wireless infrastructure and assume the consumers make their monthly checks payable directly to Cisco. 9.6 B$/year in revenue at 15% net margin gives 1.44 B$ earnings contribution in 2010 dollars. 7.5 Billion shares, dilluting at 5% per year, scaling back by 80% gives 10.5 Billion shares in 2010 for EPS contribution of $0.14/share. Now, let's be reasonable here. 100% of consumer revenue is not going to go to Cisco. Some of it is going to go to the service provider. I was just being silly. Maybe Cisco can take 80% of the 20% that will go to the internet infrastructure part, or 16% of consumer revenues. Which means this whole wireless internet might contribute $0.03/share to Cisco's bottom line by 2010. Add that to the $0.12 they are generating with their current business and you only have a) $0.85 to go to breakeven against a $20 in a mattress for 10 years b) $1.55 to go to breakeven against a 10 year T-bill c) $3.35 to go to break even against a "good buy". At this rate you need maybe 15-50 more markets as big as wireless internet in order to justify CSCO at a $20 price. See what I mean mindmeld? The market is wonderful. But it doesn't make the promise gleam that much brighter. John.

To: RetiredNow who wrote (53207)	5/20/2001 11:06:17 PM
From: Victor Lazlo	Respond to of 77398

c'mon mindmeld, get real - these "reports" you keep spewing out are paid for by the very industries they are about, so of course it's all going to be glowing predictions and "Great Expectations" !! It's fiction. Look at Forrester and all the BS they put out about the "new economy" and the trillions of dollars that would be spent online just on dog collars alone!! Ooops all the onine pet stores went kaput! They were/are paid by the dotcoms and the investment bankers to pump out this baloney. ha ha, it's all a game mindmeld, don't you see it? The numbers are pulled out of thin air, everyone knows that. And what most people also know is that there is simply no killer app that needs 3g, and so there's no need to go out and bust the bank trying to build 3g. btw, mindmeld, do you know how many additional cell towers would be needed to support 3g? Want one in your backyard? You might need it there if you really want 3g! Victor