But this looked like a bear trap to me, and I found the later down move wholly justified. Here is why.
A lot of my unease emerges from the spin of CEO John Chambers, who once ran the world's most expensive company (back in the dot-com days CSCO was like AAPL is) and whose reign since has been marked by more false starts than the Miami Marlins and a combover that has reached Trump-ian proportions.
Over the decade CSCO has flipped from being a stock appreciation play - it has nine splits during the 1990s - into a dividend play - it now has a yield of 3.14%. But since 2010, its last false dawn, the price of the shares are down from about $27/share to a little under $18.
This has come about despite a steady string of acquisitions, most aimed at giving Cisco gear some software differentiation from other equipment. Today's entrant into the Cisco family is Cloupia, whose software automates data centers. Cloupia only has a few dozen customers, although it has alliances with all the big cloud names. Allthingsd.com compares the deal to Dell's purchase of Quest earlier this year for $2.4 billion - since then DELL has fallen into the single digits.
Another problem I have is seeing Chambers brag about a $45 billion pile of cash. Well, a year ago he had a $48.7 billion pile of cash. He's lost more than that in equity value during that time.
Still, you take that cash out of the market cap and you're paying $50 billion for a company that still draws earnings of $8 billion/year. This stock is dirt cheap. But be warned - the cyclical decline in its area of the technology universe has not changed, and nothing Chambers has been able to do assures that it can pull out of the dive.
I took the ride down with CSCO, from $50/share to $25. I got out, and I'm not getting back in. But if you need yield, and can risk capital depreciation in the name of it, this is a name to conjure with.