Cisco, on the other hand, is the one huge-cap company that we thought was not trapped by the PC, so the expectations were as high as they were low for HPQ.
But is there any doubt that Cisco at $22 is a better company to own for the long term than HPQ at $27?
I don't think so.
As far as I am concerned, what we have here is simply Chambers talking down a story to a more realistic level from where the stock blasted off to last time when he had his bright side on.The dark side takes things down, but not through the secular decliners in terms of multiple and that's why the stock should be bought not sold. After this decline it's cheaper and better than Oracle at $30 after its hideous disappointment going back to $33. I would sell that all over again. It's better than Microsoft at $32 coming from $36, where there is no real catalyst save gaming. It's simply retracing some of the gain and getting ready for its next move. If the chart tells us one thing, it's that Cisco shares will be dead money for a bit until we realize that it's too cheap vs. the cohort, but it will not trade back to $26 until the next quarter is announced because that's the one that follows the now-reduced expectations. In a maddeningly inconsistent company with a maddeningly inconsistent dark side/light side CEO, this is the only pattern worth concerning yourself with. It's the only pattern that can make you money with Cisco and it says buy today, don't sell, but be prepared again to buy Friday and Monday, too, before the stock settles at a level that's just too darned cheap and starts its move all over again at a higher level than before it gapped (but not much more than that). If you just recall that Chambers is a technician in technology's clothing, you will make the right move in today's action. Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long CSCO and JOY.
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