To: craig crawford who wrote (12527 ) 2/18/1998 3:30:00 PM From: The Phoenix Read Replies (2) | Respond to
Craig, << You're always so negative >> Oh really? How would you know? << Are you still hoping for a pull back >> No, I'm hoping C$CO goes to 200 while I'm short. << EPS estimates for the year are between $1.69 and $1.77 of which .92 is in the bag already >> So if C$CO has 0.92 in the first 2 Q's of 1998 and they are supposed to earn $1.69-1.77 for the year (I'll use the higher $1.77 number) that would leave a balance of 0.85 cents. Considering how C$CO earned 0.92 in the first half you are expecting C$CO to earn less money in the second half than they did in the first? How can they justify your PE of 50 with that kind of "growth". << I should add that Cisco was one of very few networkers that hit their earningsestimates in the face of this weakness >>That's because they report a month or two later than the other networkers so analysts have plenty of time to hack the numbers when they see crumby numbers from the rest. << Third, yes it's true that CSCO revenues have increased at a slower 30% rate for the first two quarters of 98 >> Try 26.6% for the last Q. The quarter before that was a 30.2% revenue gain. That would be an average of around 28.4% revenue growth for the first 2 quarters of 1998, not 30%. Furthermore it is slowing, like I said 26.6% for the latest Q. Their EPS gains were even worse. Only up 26% for the first 2 quarters of 1998. Can we expect revenue growth of only 20% for next quarter? I see. The economy is going to just keep on growing at the same pace that it has right up through 2000. There will be no setbacks, recessions, crisis, etc. You are too complacent my friend. That always happens near the end of an economic expansion. It has been so long since we have had a slowdown in our economy that people forget that they can even occur. I don't know how Chambers expects to have revenues of $20B by 2000. That would imply a 40% growth rate for the next few years. Cisco could only muster 26% last quarter. Just remember Chambers also promised 30-50% growth last year. Hasn't happened for the last few quarters. First of all I never sais that John Chambers wasn't capable or successfull at running C$CO. My problem is C$CO has not delivered on it's promises as of late yet the street bids the stock up anyway. I have no problem with the job Chambers is doing, I just have a problem with the street who buys into the promises, and then doesn't care when they aren't delivered on. Second of all what does my capabilites of running Cisco have to do with anything? Are you saying that you shouldn't short companies who have CEO's that are more capable than yourself? What a stupid argument. All of the CEO's that drove AAPL into the ground are more capable than me. If I would have been running Apple I would have ran it into the ground in one month rather than several years.
