Cisco (CSCO) — Turning Around A Tanker Ship

I want to preface this by saying I really like the Technology space, particularly large cap tech, in this cycle.  That being said, I still listen to what history tells me and use statistics based trading signals rather than emotional ones.

Cisco has made a habit of missing earnings.  The CEO also has a penchant for drama and over-enunciating the headwinds associated with their business.  The combination of the two surely frustrates the analyst community to no end.  Below is the last example of the CSCO miss-and-warn combo playing itself out versus the QQQQ index:

As you can see, it took twenty-nine days of under-performance relative to its benchmark before it regained any footing and outperformed.  Fire this one up in your charting package for yourself and scroll back through earnings announcements and see how long this thing takes to turn around.  Some are more elastic and offer great trading, and some are flat-line.  The stock is so big and slow that it simply takes a long time to “get the poison out.”  They say to buy when there is blood in the streets, but in this case you can probably afford to sleep on it at least a day or two.

Cisco shares hit on results, downgrades (Market Watch)

Cisco Report Agitates the Street — Again (The Street)


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