Inline skating for Cisco
Posted
Aug 05 2008, 02:22 PM
by
Minyanville
Rating:
I think we should expect the usual Cisco quarter: Not the usual recent quarter, where they offer a disappointing outlook, but the one where they meet or beat by the penny and guide inline, maybe sprinkled with a hint of, "We continue to execute well and expect to gain share during these tougher operating environments."
More specifically, as Juniper showed, network traffic on a global scale is still strong enough to justify purchases of the big boxes (core routers). I expect Cisco will exhibit strong core-router sales as well. I also think switching and storage enterprise numbers will continue to show solid results as well - Foundry, for example, recently beat and raised numbers.
As with any current report, the guide is the key. The biggest issues for guidance will be consumer-driven areas; I expect these will be mixed to sluggish. However, I think they'll be good enough to keep Cisco from lowering guidance. In fact, while next quarter could be a bit of a coin toss, I'm looking for a better-than-expected incline into the fourth quarter of 2008 and the first couple of quarters in 2009.
As previously mentioned, we've seen beat-and-raise quarters from Juniper and Foundry; Netgear was also solid. This morning, we had 3Com come out of nowhere, raising numbers for next quarter on routing sales into Huawei (China's largest networker).
Like Qualcomm a couple of weeks ago, Cisco's an easier longer term call, given the sheer number of positive catalysts on the horizon (video over IP, HD over IP, gaming, resurgent video conferencing, global carrier ISP traffic growth, smartphone bandwidth growth, etc.) - not to mention builds in China, India and other emerging economies. Essentially, whole industries are moving their product distribution network -- including media and advertising content -- to the Internet.
Top Stocks blogging partner Todd Harrison is founder & CEO of Minyanville.com. This post was written by Minyanville Contributor Sean Udall. For related analysis, see:
Juniper, Cisco Clear Frontrunners
Qualcomm Sending Strong Signals
Yahoo Priced to Miss
