Market Deserves More Credit for Cisco's Rally

But Reuters remanded, leaving it to The Wall Street Journal to spell it out:

"To offset some of the pullback, Cisco has broadened its product line beyond an original speciality in switching and routing devices. The company has been among the most aggressive acquirers in the high tech industry, assembling engineers and programmers from start-ups to push further into markets such as social networking, online video and conferencing."

In that aspect, Reuters treatment of Cisco's earnings was not as positive as it should have been, failing to recognize the significance of the company's beating expectations without relying as heavily as usual on its standby business to do so.

But in another aspect, the business media shed Cisco's earnings in too-positive a light, siding with the small beat of expectations in the quarter just passed vs. the small notes of caution the company laid down about the future.

The Wall Street Journal made a clear choice, leading with the headline "Cisco Profit Climbs 4.4% on Sales Growth" and subordinating this to the subheadline: "Chief Sees Uncertainty Over Economy Lingering for Next Few Quarters."

This is not uncommon, nor totally inappropriate. But in all articles that are more positive than not about a company that obviously reported just-better-than-expected earnings, you, the savvy investor, should decide where that positivity stems from. Is what you're reading colored, for example, by a particularly good day in the stock market?

In this case, while many articles were positive and mentioned the excited reaction to Cisco's results by after-market traders, few -- not even The Wall Street Journal in an otherwise-decent article -- mentioned the market's mighty Tuesday and made the connection (implicit or otherwise) with how that might have made everyone from traders to journalists accentuate the positive.