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

To: James A. Shankland who wrote (22119)	2/7/1999 2:18:00 AM
From: conrad grant	Read Replies (1) \| Respond to of 77400

>That would take its price into the mid-50s. If history is any guide, >and it generally is except when it's not, that will be a very good >time to load the boat. If not, one misses the boat.........

To: James A. Shankland who wrote (22119)	2/7/1999 2:37:00 AM
From: ed	Read Replies (1) \| Respond to of 77400

The question is what PE do you think is appropriate for CSCO ? and why ? Well , if PE of 35 is appropriate for CSCO, then why not PE of 200 ? People may think PE of 50 is appropriate for KO twenty years ago when the market for sugar water is growing, while for today , even PE of 25 for KO is too high when the market of sugar water is saturate . You all know what business of CSCO is in and the potential , and it is still in its infancy and far from saturation. People think PE of 100 for CSCO is too low today, it did not guarantee the sentiment will not change 20 years down the road when the market for CSCO is saturated, and maybe , PE of 35 is way too high at that time under that market conditions. But, I do not think people will think PE of 35 is reasonable for CSCO under the market conditions of 1999 for CSCO's products, because the market is still in its infancy and expect to grow very fast in the years to come, and this industry is just too important for the future of humanbeing. So, PE of 35 is way too low for CSCO in 1999, and probably a PE of 120 is even too low for CSCO in 1999. Think about that PC will be everywhere, and every PC will be connected, in your office, in your home, in the airport, in the post offices, in the bus station, in the banks, in the factories, in the hospitals, in the universities, ....etc. How large the market will be ? Do you know ?

To: James A. Shankland who wrote (22119)	2/7/1999 2:05:00 PM
From: Mike Gordon	Respond to of 77400

Sorry for the late response to your message. Without going into a 'tautological' binge, I agree with Ed's point that the traditional valuation of PE's isn't necessarily the primary reason why investors buy CSCO or other tech issues. I'm not sure that the retail investors are in control of the momentum behind CSCO. In general, investors see future value in CSCO with the added benefit that CSCO, like LU, enjoys certified revenue, earnings, and profit today. In summary, investors feel that the Internet is the future of the world. Sophisticated investors will invest using some of the old valuation methodology while unsophisticated investors will buy on fads and trends. In today's environment, both will do well. When the market corrects, the unsophisticated will be the first to loose.