Get to Know Cisco

By TheWild1 at 6 February, 2008, 7:00 am, Categories : Stock Recommendations

This week I want to turn focus back to the technology sector. This category was unstoppable for most of last year; however, since around November these stocks have begun to take a real beating. One of those stocks is Cisco (CSCO).

General Summary

At one point this stock was riding high up at $34.24, but almost came back down immediately. The beating that CSCO has experienced is why I am starting to look back at it. Right now the stock is flirting with new 52 week lows every day and it hasn’t been at these level since mid-2006.

CSCO looks to report earnings today, and is predicted to report a very good outlook, although right now anything can look better in this market. On many occasions everything I have stated so far would make me want to jump on this stock right now; however, I am first interested in see what the ACTUAL report is going to be. In this type of market, almost anything can cause a huge sell-off.

Chart Examination

To be honest, nothing really stands out at me when looking at the chart except the beating the stocks has taken is pretty evident. This leads me to conclude that this stock is a very good value play. I see a small resistance at 24 and 25, so watch for those to be broken.

CSCO 2508

Final Outlook

I would wait to buy any shares until after the earnings are reported. If numbers are great and the stock rises, then I might jump in just for the quick boost and then get rid of my position, but be cautious. In this market, many bull runs eventually get stopped real quick. No matter what comes out of the earnings, I see this stock coming back down to 23ish, so I would wait for that before making my long position.

If you want to play it a bit safer, then I would wait until the stock is up to $25 to buy it, but I don’t think this stock is capable of going too much lower. I have a price target of $28.

Also check out Juniper Networks (JNPR).