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Tuesday, November 25, 2008

Report of Instability at Cisco Prompts Investors to Sell

cisco stock

Evidently, Cisco's (NASDAQ:CSCO) alliance with IBM (NYSE:IBM) and  demo at the UBS' Global Technology & Services Conference last week didn't generate the positive momentum neccesary to reverse its slumping stock. Cisco dropped 0.98, to 15.42 per share, (-5.8%).

Bloomberg.com reports that Cisco, the biggest producer of network gear is suffering from businesses that don't have the usual amount of cash to upgrade their network communication systems. As smaller business contract, rather than expand their networks,  Cisco is feeling the brunt of the impact and compensating for the difference by closing its doors for five consecutive days- Dec. 29-Jan. 2-to save $1 billion in costs.

The report came from Nikos Theodosopoulos , an analyst for  UBS, is giving Cisco a neutral rating. He said:

 

It is prudent for Cisco’s management team to plan for cushion in the event of weaker than expected revenues.The move will help Cisco cut payroll and facility expenses

 

Other notable losers today were Microsoft (NASAQ:MSFT), - 3.38% and China Mobile Limited(NYSE:CHL), -4.02%

By Matt O'Hern at 04:47 PM | Comments (0)

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