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

To: Lizzie Tudor who wrote (63694)	4/22/2003 1:12:53 PM
From: GVTucker	Read Replies (1) \| Respond to of 77399

Lizzie, RE: I only said it sounded a little low, and because I know how companies try to minimize earnings relative to cash flow, I don't think I really care all that much. Companies try to minimize taxable earnings, yes. But we're not talking about that. We're talking about GAAP earnings of a public company. And there is no question that Cisco tries to maximize that number. The issue is whether or not 16K employees of a company can realistically generate 14 billion of wealth through the exercise of stock options over a 10 year period. Cisco has had many, many more than 16K employees over the past 10 year period. In fact, at the end of the last fiscal year, Cisco had 36K employees. Even with the announced layoffs, the number doesn't get close to 16,000. And that doesn't even count the people that aren't at Cisco any more but exercised options and then left the company. No, its a waste of time imo. And it mostly only serves to substantiate your claims that Cisco is not a wealth creating company, and I don't want to bother with that. This is in response to John's request that you do the math. If John's premise is false, how will your doing the math justify a false premise? My feeling is that all this relentless number crunching now is a waste of time, I know the revenue targets for Cisco for the next upturn. I thought that the "valuation doesn't matter" mantra died with the bursting of the Bubble. But given that you think number crunching is a waste of time, I guess that doesn't apply in your case. Then again, you own EBay at the current level, so I guess that you're just being consistent. And it sounds very much like

To: Lizzie Tudor who wrote (63694)	4/22/2003 1:13:52 PM
From: rkral	Read Replies (1) \| Respond to of 77399

OT ... re "The issue is whether or not 16K employees of a company can realistically generate 14 billion of wealth through the exercise of stock options over a 10 year period. I say no, it isn't really possible. In fact, it is so far off the mark of a realistic ballpark amt I really couldn't let it go. You now say stock options are a "major" contributor to the phantom cash machine (which has magically generated a bunch of cash). OK so how much of that 14 billion do you think came from employee options exercising then John?" Lizzie, John just showed you that $10.348 billion came from option exercise during just the last 7 years. And you don't consider that in the ballpark of $14 billion? Regards, Ron

To: Lizzie Tudor who wrote (63694)	4/22/2003 11:48:53 PM
From: Stock Farmer	Respond to of 77399

OK so how much of that 14 billion do you think came from employee options exercising then John? Please be specific,... I was quite specific: 10.349 B$, plus or minus a billion or so. ... because I don't think there is a chance in hell that Cisco got over $400K in cash from each employee at the company in order to create this phantom cash stockpile. I actually think the amt of cash per employee that Cisco has captured as a result of stock options is somewhere around 50K MAX (and probably not even that, since the employee count is larger now than it was before so you have to spread the executives over a larger pool of workerbees). What you think and what is revealed by the company reports are two different things. Cheers, John