What is Digg?52 Comments
- nepawoods, on 11/17/2007, -0/+7"This is a tech news site is it not?"
Not judging by what usually makes front page (ron paul and lolcats). - gr00vy, on 11/17/2007, -1/+8This doesn't mean that the stock is undervalued. It is often a wash, because it is changing 10 billion in assets, by removing 10 billion in dilution. Similar to a stock split. Often the point of all of this is to manipulate the stock market by creating buy demand when there is a lot of sell demand. The sell demand tends to come from two places, those that sell short, and large insider holdings. Generally, this keeps a floor on the price of the stock and provides a market for these two not very bullish activities.
In high tech companies, this tends to also balance options that have been awarded to people on an annual basis and to also keep an active buy market happening even with continued selling into the marketplace.
Ultimately, you could say it is bullish because it is not bearish. But it mostly reflects a neutral stock price, and liquidity for insiders/employees. - Error601, on 11/17/2007, -5/+10The first line, and one quoted in the description, doesn't match the rest of the article. They're concerned with the employee stock option benefits diluting the value of the shares. So, they're buying up shares to give to their employees exercising options.
- localzuk, on 11/17/2007, -1/+4Because this is a technology news site? And its users find it relevant and interesting?
- Phantastica, on 11/17/2007, -1/+4Because somebody at Digg owns Cisco stock and got boned by the recent plunge in their share price?
- localzuk, on 11/17/2007, -2/+5I'm confused... Why are so many people saying 'why is this front page news' and 'i don't care'? This is a tech news site is it not? People reading this site more than likely have some exposure to cisco hardware and some may have shares in cisco...
- Buelldozer, on 11/17/2007, -1/+3Because there is a LOT more to configuring a network and its infrastructure than knowledge of subnetting and QoS. Do you know how to configure an ISR with a call tree? How about BGP and fail over routes across load balanced 7000 series? No? Well then, there is your answer.
- jonnyeuchre, on 11/17/2007, -0/+2A sign that the ceo's options are still underwater
- getoffmybridge, on 05/05/2009, -0/+2Yeah thanks for the tip, try pricing actual Cisco products for your next trick.
- inactive, on 11/17/2007, -1/+3Play Wall Street like a PONZI SCHEME!
- inactive, on 11/18/2007, -0/+2FYI, gr00vy is expressing a pessimistic or conspiracy theorist view. Generally companies buy back shares not only to increase share price, but also to profit later when the price goes up (and the company sells the shares). This ability is one of the reasons companies choose to go public, and is completely legitimate.
- zoom1928, on 11/18/2007, -0/+1Also, it can show that the company lacks direction and business opportunities. In other words, they have nothing better to spend the money on. Sometimes it's a very good sign that the people in the know think the stock will go up, but usually it means the executive management is lacking in strategy.
- Vectorkov, on 11/17/2007, -0/+1True, not to mention the numerous other area you can get certs in like storage, security, voip, etc
There's always more to learn. Sure, you don't have to take the classes, but self study and passing the exams can help you learn a lot, whether its cisco, microsoft, juniper, etc. - gr00vy, on 11/18/2007, -0/+1Some loaded words. This is not moonbat speak, nor 9.11 hysteria, but simply pointing out the most likely reality. Simply, a fundamental truth to stock value is that the price reflects some percentage of actual value (it's assets), and some percentage based on cash flow, and some percentage based on growth of cash flow and assets.
Buying your own stock, can do several things, it can increase percentage owner ship by non-sellers, up to the point of taking the entire company "private", which does happen. Not rarely, but certainly not commonly.
But generally it both lowers existing assets, the companies 10 billion dollars, and future growth of that asset, and removes the dilution by 10 billion dollars. But this tends to be a wash, and doesn't significantly improve the stock price. So why do it?
Because the day to day management of a stock price depends on the qty of buy and sell interest. If it is balanced the price tends to stay the same. If unbalanced the price tends to move. This is also gated by many different forms of speculation from options, selling short, short covering and option covering, and ultimately value investors, and finally by the takeover value of the company.
The true value of buying your own shares in a company that has a lot of cash, and a lot of options that employees and insiders would like to "diversify" or in essence convert to cash. There would be more sellers than buyers. This will make the stock decrease, increase the volatility of the stock, and depending on your position in the stock market change fundamental benchmarks. The amount of actual sell pressure can significantly lower the value of the stock.
This can and is mitigated by many companies in the same position by providing buying activity for the sellers, and keeping the company's stock price stable. Again, it is not so much a bullish thing to do, it is to keep from getting a bearish performance in the stock. At the end of the day you will find that there is not much dilution difference at all from pre and post buying shares by the company. That indeed the "float" tends to be about the same.
A big source of shares can be massive insiders that are divesting, and there simply is not enough to demand to take care of it. Even with company buying of massive quantities of shares, and massive dividend payments to existing customers, that the stock price can be stable for years and years, even with a growing company from bottom line to EPS.
A company can attempt to capture cash from the marketplace at any time by releasing stock. Most companies don't however, once they have gone public. As the existing shareholders tend to suffer by increased dilution. So the company tries to make sure that they have enough capital at the moment of going public to both allow company growth, and to increase shareholder value.
Usually, when a company wants to grow in a fashion as described, and they are already public, is to attempt to purchase a company, especially a company with assets. This allows the company to issue shares (to purchase the new company), increase assets (the cash they are purchasing), and increase the size and growth of the company, often by either getting a new marketplace, removing competition, and or removing redundant expenses such as personnel and rent. You will rarely see a company just sell more shares to raise capital. But is M&A is done well it provides benefit to the existing shareholder. - imightbewrong, on 11/17/2007, -0/+1why would you be?
- getoffmybridge, on 05/05/2009, -1/+2Why'd you feel the need to work "whoever you are" into your reply? Little flare for the dramatic there, whoever you are?
- ussoldier, on 11/18/2007, -0/+1More like a sign the US dollar has tanked, and as ***** as their shares are and their economic prospects are, its still a deal to buy back control and ownernship at this fireside sale compared to the boodles of bubble money they made in the nineties. The whole bottom has fallen out of the computer and networking industry... quite frankly, everyone now has all the equipment they will ever need. I don't see Cisco ever going up again... their future looks down hill... but still, they cleaned up like Google in the nineties on the stock market, and were overpriced like you wouldn't believe.
- jubilee123, on 11/17/2007, -2/+3why is this still on the front page? lol
- HotSaucePanCake, on 11/17/2007, -3/+4CEO dumps 2/3 of his stock in the last year.... CEO comes out with Bearish Forecasts... plummets CSCO down to 28... from 34.... decides to buy back $10 large.... savings? kinda fishy IMO... I wonder if the buy back is to take place over an extended period of time.
- elfjuice, on 11/18/2007, -0/+1Are you warning us not to abuse the comment section? Or are you warning others that you are about to abuse the comments section? I'm not really clear about what your comment is trying to convey...
- cadams, on 11/17/2007, -0/+1Done! I love to help out other people. Glad to be of assistance. :)
- xtmno3, on 11/17/2007, -0/+1I am digging many down, but because their comments are worthless. Also, digg is no longer a tech site. It is basically a composite rss for the blogs of the net...
- localzuk, on 11/17/2007, -0/+1True... It appears this page is being attacked by the diggdown squad...
- localzuk, on 11/17/2007, -0/+1Well Juniper are good, but there is another jump in price for them... You also have Extreme Networks which are good. The point I am making is that people who can afford to, go for cisco, not HP for their routing. If they can afford even better then obviously they'll go for something bigger.
The right tool for the right job and all that. - localzuk, on 11/17/2007, -1/+2It gives you a worldwide recognised certification which helps you get jobs, and helps fill in the blanks where you may be thin on knowledge. You could say the same thing about any qualification - if you already know the stuff, you don't really need to take the course.
- Giga, on 11/18/2007, -0/+0Why do people keep asking that?
- Giga, on 11/18/2007, -0/+0There can only be one best story ever. Are you suggesting you only want to read the one and only superior article out there? If so, digg isn't the right place to look.
- pete6677, on 11/18/2007, -0/+0Does this mean the stock might actually hit $50/share again? Because this would still only be half of what it was once worth.
- localzuk, on 11/17/2007, -1/+1What? You obviously don't work in networking then! Cisco gear is what people go for if they want a first rate network - HP is what they go for if they can't afford HP. Also, HP don't make many routers as such - they are more focused on intelligent switches with the only real product marketed specifically as a router being the 7000dl series. I'd suggest you take some courses on networking before making uninformed statements like that...
- shaherazad, on 11/17/2007, -1/+1Am I the only one who has no idea what this means?
- Giga, on 11/18/2007, -0/+0Comment abuse warning...
For everyone about to post "who cares" in this thread, we already have enough of that. A lot of people do actually care, so what if you don't? - Giga, on 11/18/2007, -0/+0Apparently lots of people care. Who cares that you don't care?
- dark1587, on 11/17/2007, -0/+0Replace "Cisco Routers" with "Juniper Routers" and you might be able to make a case ;-)
And yes I know I'm going to get dugg down for that statement. - inactive, on 11/17/2007, -3/+2Ive never understood the Cisco certification, what is their really to work with that you need training for? , If know about networking, assigning ip's Qos, and bandwidth management, stuff you can learn on your on, then what do the classes tell you?
- osbjmg, on 11/17/2007, -2/+1It's not a move so you, whoever you are, can feel sorry for them. It's just a value, buy when it's cheap comparatively.
- dark1587, on 11/17/2007, -1/+0Yes. At the very least the entry level exams give you the basics of setting up networks and help establish a good foundation (in networking) to go on. If you choose to look at competitors later in life, then it's a matter of learning the commands in how to get the same thing done like you would with Cisco.
- ericdano, on 11/17/2007, -4/+1Having had to deal with Cisco when I worked hitech in 1998, and having actual meetings with John Chambers in regards to their employee training, I can see why they think their stock is undervalued. They have a culture at Cisco where they think they are 4.5 out of 5 if not 5.
- swoopdog, on 11/17/2007, -4/+1last I checked linksys was the cheapest anything around.
- Genghis1, on 11/17/2007, -4/+1Is Cisco certification still worth getting? Any opinions?
- bbeep, on 11/17/2007, -6/+2This description is misleading at best. If the shares are undervalued, why would employees be cashing in their options, leading Cisco to have to buy them back just to prop up the price?
- getoffmybridge, on 05/05/2009, -7/+2Undervalued? Gtfo. Booohoooo, we charge more than anyone else for our products, and our stock isn't worth enough. *cry*
- TheGuruStud, on 11/17/2007, -7/+1Cisco = worst product ever, guaranteed, with the exception of some of their access points, etc, but those are still over priced. I'll take a HP router any day for a fraction of the cost. Thanks Cisco for making 5,000 dollar devices that suck dick. Well, really, they're only 50 bucks of mid 90s hardware with the rest being the charge for their unintuitive, malfunctioning software.
- zenshin, on 11/17/2007, -9/+3Maybe a huge announcement in the near future?
- TravelTom, on 11/17/2007, -7/+1Cisco first page?
- Uranium118, on 11/17/2007, -11/+4Bravo for them, why is this front-page worthy?
- weirdlookinguy, on 11/17/2007, -9/+2Don't make me feel lonely, digg me down too!
- djspike, on 11/17/2007, -11/+4doesn't every company think their own stock is undervalued?
- VMark, on 11/17/2007, -10/+3Who cares? Buried.
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