Friday, May 13, 2011

Cisco naysayers ignore the obvious...

The nature of this blog is going to divert for a while. I've recently found some topics that I feel I need to write my $0.02 about, and this is as good a place as any to do it.
Recently Cisco CEO John Chambers found himself admitting that next quarter's profit might not be as good as the analysts first thought. This prompted some talking (well, writing) heads to criticize the man who took Cisco from single digit billions to double digit billions.  I felt a need to point out to this <snark>financial genius</snark> the obvious issues he overlooked. Comments follow below.

 "Before reading your article, I had some concerns about Cisco's future. Now I realize things are about to go very well for Cisco. It's my feeling that what the market "knows" is inevitably wrong. Also, I notice the points you didn't mention as well as the ones you did. Your article fails to mention Unified Computing, Cisco's entry into the virtualized server market, which grew 700% in revenue year over year. You can't claim that to be through acquisition. You failed to mention the VCE coalition with VMware and EMC, which is changing the industry from the days of piecing the datacenter together from parts you have and parts you buy, and hoping the architectures works the way you planned it, to buying unifies systems that have been tested together to minimize risk. You only point out risks Chambers took that didn't work out, not the risks that succeeded. And now John Chambers has motivation to clear off those that didn't work, and focus those that did. 
As for beating the market, the market is a manic depressive, not a fountain of wisdom and truth. Cisco will be back in fashion among the analysts someday. Which of the stocks that _did_ outpace the NASDAQ paid a dividend? Which are within 50% of Cisco's valuation? "



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