Streaking Apple still looks safe valuation bet
– The author is a Reuters Breakingviews columnist. The opinions expressed are his own –
By Robert Cyran
NEW YORK (Reuters Breakingviews) – Apple may be streaking, but the stock still looks a safe valuation bet. The $315 billion tech giant’s sales rose an astounding 83 percent in its second quarter, ending on March 26, from the same period last year. Moreover, Apple’s operating margin increased slightly, meaning profit almost doubled. Yet adjust for cash, and the stock trades at a discount to the market. That seems too cheap.
China’s hot Facebook clone will cool down
By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Renren has reproduced Facebook’s social networking model in China. But it’s leading the way in launching what may be the first big social network IPO anywhere. With more than 100 million users already and China’s 1.3 billion people on tap, investors will probably fill their boots — and only later worry about things like competition from Facebook itself.
Cisco takes first small step to focusing on core
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
By Robert Cyran
Cisco’s boss, John Chambers, acknowledged last week the company he has run for 16 years had lost its way. Now he’s putting some money where his mouth is and shutting parts of the over-reached networking group’s shrinking consumer unit. That’s sensible, but more will be needed to simplify Cisco’s sprawl and improve shareholder returns.
Google antitrust deal sets stage for bigger fight
By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
The U.S. government’s agreement to allow Google to buy Internet travel programmer ITA Software — with a few sensible restrictions — is just the appetizer. The main course in the extended meal shared by Washington and Silicon Valley will be control of the huge markets for broad Internet search and mobile operating systems.
Cisco chief vows to restore “flawed” company
NEW YORK, April 5 (Reuters) – Cisco Systems Inc (CSCO.O: Quote, Profile, Research, Stock Buzz)
chief John Chambers, in a remarkably candid memo to employees,
admitted the one-time technology bellwether and Wall Street
darling has lost its way and will need to change to restore its
credibility.
Chambers, one of Silicon Valley’s most respected corporate
chieftains, confessed in an internal email that the networking
giant had been slow to make decisions, fallen down on execution
and lacked discipline in an aggressive expansion.
Exclusive: Is Cisco bracing for an activist siege?
– The authors are Reuters Breakingviews columnists. The opinions expressed are their own –
By Rob Cox and Robert Cyran
NEW YORK (Reuters Breakingviews) – Cisco Systems makes a juicy target for an activist assault — and Chief Executive John Chambers seems to know it. True, as a company with a market value of nearly $100 billion, most uppity investors don’t have the means to build a significant stake in the technology giant. But Cisco’s poor performance, valuable assets, cash pile and years of capital misallocation provide the kindling to spark long-suffering shareholders into an uprising.
Cisco chief admits “flaws” in memo to staff
NEW YORK (Reuters) – Cisco Systems Inc chief John Chambers sent a memo to employees defending the networking company’s strategy while acknowledging it has flaws in “operational execution” and a loss of accountability.
The 1,490-word e-mail, sent to Cisco employees on Monday, calls for the company to focus on five areas: routing, switching and services; collaboration; data center virtualization; architectures; and video.
Exclusive: Cisco chief admits “flaws” in memo to staff
NEW YORK (Reuters) – Cisco Systems Inc (CSCO.O: Quote, Profile, Research, Stock Buzz) chief John Chambers sent a memo to employees defending the networking company’s strategy while acknowledging it has flaws in “operational execution” and a loss of accountability.
The 1,490-word e-mail, sent to Cisco employees on Monday, calls for the company to focus on five areas: routing, switching and services; collaboration; data center virtualization; architectures; and video.
Share buybacks return in force at wrong time
Home Depot investors were happy about the new stock repurchase plan, adding about $1.5 billion to the company’s market value on Tuesday. History suggests they should curb some of their enthusiasm. U.S. companies have a terrible track record of buying their own shares high and selling them low. Home Depot’s $1 billion program adds to the $136 billion of buybacks announced this year. Only the market peak of 2007 saw more such activity. That’s not a good sign.
In theory, a buyback can be the best way to return surplus cash to investors if the stock is below its intrinsic value. Share counts decrease, leaving investors who stick around a larger chunk of the company. That means more profit for them down the road. Moreover, investors don’t have to pay taxes like they do when a company issues dividends.
EBay sensibly bids $2.4 billion to go beyond auctions
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
By Robert Cyran
EBay has sensibly bid $2.4 billion to go beyond auctions. The fast-growth days for the Internet giant’s marketplace unit are behind it. Running Web fulfillment and delivery efforts for others promises growth and is a natural extension of its own business. Buying GSI Commerce does the trick. The 51 percent premium is big but the price still looks reasonable.
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