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Stock impact report

Compared With 2000, Tech Is Playable [Forbes]

Cisco Systems, Inc. (CSCO) 
Last cisco systems, inc. earnings: 2/12 04:05 pm Check Earnings Report
Company Research Source: Forbes
Compared With 2000, Tech Is Playable (AP Photo/Gregory Bull) Photocredit: Associated Press. My memory of carnage during the tech bubble of 2000-01 is indelible. Microsoft was the best of the worst, down just 20%. Shrinkage among the top 10 names in the Nasdaq 100 Index ranged up to 80% with Cisco down 77% and Intel minus 63%. Meantime, internet infrastructure providers like Akamai Technologies and Inktomi sold at 80 to 100 times revenues. Analysts employed 10-year discounted cash flow models to justify their picks. Armchair investors coulda turned down tech then as overpriced just by looking at five-year comparisons of price-to-revenues metrics. Anyone who pays more than two times the growth rate for anything is bound to incur severe heartburn. Overvaluation in tech took some 25 years to correct. This sector now sells closer to parity with the S&P 500 Index at 18 times earnings, itself a heady multiplier. Yearend, 2001, Microsoft’s market capitalization of $357 billion was the standou Show less Read more
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