Tag Archives: Ebeling

Cisco Contrarian Thinking

I read a well written post this morning on Ebeling Heffernan about Cisco’s earnings, due today after the close. The post lists the things working against Cisco:

  • Peer Performance – JNPR, BRCD, RVBD are all crashing…
  • Management and Restructuring Signals – Mediocre Management…
  • Austerity Order Risk – Governments aren’t buying…
  • Buy Back vs. Dividend Strategy – Buy back is worse…(?)

But Mr. Ebeling, Jr. fairly points out that at 8 – 9 times earnings Cisco might be on the extreme end of it’s ‘turn-a-round’.

Each time CSCO releases earnings, I try to find a good setup. My track record isn’t great and I hesitate to jump in again. As I mentioned in my post on July 18th we’re seeing concrete changes finally. So should we continue to play with this falling knife? It’s likely to dissappoint, again.

I’m going to buy stock. I’ve worked with their product and have confidence in it. That’s no trading strategy, but I’ll add a little stock today, for that reason only.  Isn’t that why we have the stock market? Under 14 looks cheap. I’m avoiding the options, unless I can come up with a decent spread.