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

To: RetiredNow who wrote (53232)	5/20/2001 5:47:00 PM
From: RetiredNow	Read Replies (3) \| Respond to of 77398

OK, John. This is first pass and verified as much as possible from research reports in a short time span. Markets Cisco competes in and their expected size in billions: 2001 2002 2003 2004 2005 Cable & DSL 4.8 7.2 10.8 16.2 24.3 Routers 3.0 5.2 8.9 15.3 26.3 Switches 13.2 15.8 19.0 22.8 27.4 IP Telephony 0.8 1.0 1.4 2.0 2.7 VPN & Firewalls 1.5 2.2 3.2 4.8 7.0 WLAN 2.0 2.5 3.1 3.8 4.7 Storage Area Networks 2.2 3.6 6.0 9.9 16.3 Sonet/SDH 14.8 16.1 17.6 19.2 20.9 DWDM - LH & Metro 8.8 12.6 18.0 25.7 36.8 Residential Gateways 0.1 0.3 0.7 1.9 4.9 Network Management 0.5 0.7 0.8 0.9 1.1 Total 51.7 67.2 89.5 122.4 172.4 Cisco's current share of these markets (some verified, some estimated from articles): Cable & DSL (#4) 13.1% Routers (#1) 60.0% Ethernet Switches - incl Gigabit (#1) 75.0% IP Telephony (#1) 50.0% VPN & Firewalls (#1) 60.0% WLAN 20.0% Storage Area Networks 20.0% Sonet/SDH (#6) 29.2% DWDM - Long haul & Metro 3.0% Residential Gateways 20.0% Network Management Software 50.0% Cisco's projected revenues if market share doesn't change: 2001 2002 2003 2004 2005 Cable & DSL (#4) 0.6 0.9 1.4 2.1 3.2 Routers (#1) 1.8 3.1 5.3 9.2 15.8 Switches 9.9 11.9 14.3 17.1 20.5 IP Telephony (#1) 0.4 0.5 0.7 1.0 1.4 VPN & Firewalls (#1) 0.9 1.3 1.9 2.9 4.2 WLAN 0.4 0.5 0.6 0.8 0.9 Storage Area Networks 0.4 0.7 1.2 2.0 3.3 Sonet/SDH (#6) 4.3 4.7 5.1 5.6 6.1 DWDM - LH & Metro 0.3 0.4 0.5 0.8 1.1 Residential Gateways 0.0 0.1 0.1 0.4 1.0 Network Management 0.3 0.3 0.4 0.5 0.6 Total 19.3 24.4 31.7 42.2 58.0 Cisco's expected stock price assuming 15% net margin, o/s share increase by 4% per year, PE decrease by 4% per year: 2001 2002 2003 2004 2005 Net Income $2.9 $3.7 $4.8 $6.3 $8.7 O/S Shares 7.2 7.5 7.8 8.1 8.4 EPS $0.40 $0.49 $0.61 $0.78 $1.03 PE 50 48 46 44 42 Stock Price $20.10 $23.51 $28.11 $34.56 $43.85 That's as good as anyone can guess. You don't get more facts than those. The rest is speculation and guesstimates. I'm betting I can at least double my money within 4 years. I think that's a pretty good return. I think the above also answers your question about total market revenues. If you include the other networking segments that Cisco doesn't even participate in, you get even higher networking expenditures. Anyway, I'd love to see your analysis.