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

To: Glenn D. Rudolph who wrote (10821)	12/12/1997 9:58:00 PM
From: Robert Voigt	Read Replies (2) \| Respond to of 77399

This should dispel some of today's loss (from Bob Biersack) Cisco shares fall on rising inventory concern Reuters, Friday, December 12, 1997 at 18:42 SAN JOSE, Calif., Dec 12 (Reuters) - The stock of Cisco Systems Inc. tumbled more than 7 percent Friday amid concerns that the computer network vendor's rising inventory could translate into weaker sales. In its latest quarterly filing with federal regulators, Cisco disclosed that its inventory of finished goods had nearly tripled. An increase in inventories are sometimes a sign that sales are flagging. Stock in Cisco, the world's biggest maker of computer networking equipment, fell $6.13 to $76.56 on Nasdaq, where it was the second most active issue with 26.7 million shares traded. "People are scrutinizing their filing and the concern is that finished goods (inventory) is up," said Farrokh Billimoria, senior analyst at investment bank Hambrecht & Quist. However, Billimoria pointed out that Cisco's total inventory for the quarter was down compared with a year ago. Cisco spokeswoman Stacy O'Hara said the rise in finished goods was due to Cisco's increased emphasis on sales to small and mid-sized businesses, and a greater reliance on distributors and middlemen to pitch to those markets. "We've built to stock in order to meet the needs of two-tier distribution," O'Hara said. The rise in inventory was intentional and does not mean sales are slowing, she said, adding that Cisco cannot book revenue until the distributors ship the product to the final customer. Still, investors have been looking for a reason to sell Cisco, Billimoria said, noting that it had been one of the few issues to hold out this week when most technology stocks fell on rising concerns about Asia's economic woes.