Cisco results a beat, the stock soars.

The Cisco disco finally has a full dance floor. After hours the stock rose after reporting numbers that topped analysts' forecasts. Which is about all that matters, regardless, it seems. So after hearing a few quarters of commentary which suggested that John Chambers was not getting it, he should go, he was doing a poor job, execution was not there. I kid you not, these are the types of headlines that we are reading now: Cisco Shares Climb After Chambers Turnaround Plan Boosts Profit. I see, so it took more than 10 days. Hyperactive people, calm down, these things take time.

Cisco served up 34 US cents worth of earnings, versus 33 expected (or was it 42 actual versus 40 expected, depends), for the last quarter. More importantly, folks were worried about margins, which seem to be on the mend, gross margins up to 62.4 percent and ahead of their own forecasts. Ironically at the same time that competitor Juniper seems to be struggling. Some of the commentary said things like, well five percent revenue growth is not great, but considering that Cisco are in a change phase, this is actually good. OK. AND, this is because the company had previously guided that revenue would grow between 1 and 4 percent. Nothing like exceeding your own revenue and margin forecasts.

The dividend is hardly what you could call handsome, 24 cents a year. And expectations are for the company to make 1.89 in the next financial year. The stock trades just above 18 Dollars a share. So forward you are getting the company at less than ten times earnings. Those same analysts mostly have a hold on the stock (26 out of 43) though, but there are 15 buys on the company too. 1 underperform and 2 sells are lonely at the other end of the spectrum. And the average target price is at 19.71, currently. That implies around 10 percent upside from here. Which I would take, every year for the rest of my investing career if someone offered that to me. The stock is up 2.6 percent pre market.

Oh, and did I mention that internet traffic is expected to grow 15 fold in the next four years. That is the prediction. For the folks that provide the canals and sluice gates, that sounds like music to their ears. We continue to like and buy the stock. Some of the patience has paid off, but the stock is still a long way away from their 52 week high of 22.34. And a million miles from their all time high, somewhere around 80 Dollars a share in March of 2000. But the valuations back then were silly, they are probably silly cheap now.