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Cramer Hangs Tough

Cisco's caution warrants respect, not alarm.
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Great companies don't hype during their conference calls. Great companies tell it like it is. If there are problems in Latin America, they mention it. If there is pricing pressure in LAN switching, it gets discussed. If the next quarter is challenging, they mention that it is challenging.

That's why when you read about

Cisco

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you will be drawn to the negatives. Because John Chambers, the head of Cisco, is, above all, a humble guy who wants to tell you what can go wrong. It's his no-tout, straight-out style that produces the stair-step of Cisco's stock -- the move up and then the selloff -- as people try to figure out whether "this time is different" and Chambers is really worried.

The truth, of course, is that he's always worried, as all great competitors are, and those who sell it on his caution have, every time in the last eight years, lived to regret it.

Maybe it will be different this time. Maybe the caution will be viewed as trepidation instead of wisdom.

To which I say: That's how I get to buy more Cisco at a lower price than I would otherwise.

I don't think this time is different.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At the time of publication, his fund was long Cisco, but positions can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column by sending an email to letters@thestreet.com.