Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Ilaine who wrote (39482)	12/16/1998 4:36:00 AM
From: accountclosed	Read Replies (1) \| Respond to of 132070

I have experienced that a little lately. <g>

To: Ilaine who wrote (39482)	12/16/1998 5:30:00 AM
From: accountclosed	Read Replies (1) \| Respond to of 132070

You know I agree: some things can't be explained. I had a multi page answer about CSCO and just deleted it. It was getting so long winded. I will attempt to be more terse. CSCO is in the top five market caps on Nasdaq. If you don't see the market bubble, I am not sure I can persuade you of that. If and when the overall bubble pops, CSCO will be punished. You don't see us around here calling for buys in much of anything these days. Only special situations like oil drillers, golds, etc. CSCO quote.yahoo.com is selling for 83 3/4 at a p/e north of 80 a p/b north of 16 a p/s north of 14. I would not pay 1/2 of the 83 3/4 price for CSCO. I don't know how to make the point without being long-winded that CSCO sits right in the middle of the indexes. The overall market is way too high. From the index impact point of view if CSCO is 83 or 73, it doesn't much matter. It is like looking for a compact car and the dealer says You can have this Bentley Turbo-R for only 240,000.00 marked down from 255,000.00. Yes it is less, but not in the right price range. CSCO is a chip in the momentum game, it is a chip in ta games, it is a chip in the internet mania game. It is more than just a proxy for the Cisco underlying business. The overall market is ridiculous in valuation. In a normal market it would be possible to really set a value for CSCO somewhere at like 1/3 to 1/2 of current price. (That is not to say a buy, as one would like to buy at a price below value) A good traditional rule of thumb is p/e ought to be equivalent to the sustainable growth rate. We are more than double that here.