Cisco Out


I still like the general idea of investing in the “tech dinosaurs” who generate huge cash flows and dominate their businesses or who seem to be underestimated, but I now regret taking a flier on Cisco (CSCO) recently — so I’ve sold my small CSCO position and moved most of the cash over to expand my Intel (INTC) position. Cisco’s results out today were fine and blah-ish, but management commentary still seems very directionless and I get the sense that we’ll be seeing a lot of navel-gazing from their board for a while, and I think I underestimated the competitive threat to Cisco in the lower end of the business for routers and switches — they will probably still do fine and they’re not expensive for a cash-generating machine that still has a huge market share, but I like Intel a lot more and they trade at about the same valuation, so time for a switcheroo.

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