Assertion Partly supported AI assessment confidence: 88% certainty 3/5 debate potential 2/5

Batnick: Cisco stock collapsed post-bubble despite 15% earnings growth

Michael Batnick · Decoding the NVIDIA Trade - With Michael Batnick · Jun 26, 2024 · at 11:27

Michael Batnick draws a historical parallel to Cisco's dot-com bubble valuation when discussing Nvidia's forward expectations.

0:00 / 0:18exact quote · 18.6s

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“Cisco, the business, compounded its earnings at something like 15% in the 15 to 20 years after the bubble burst. The stock got destroyed because it wasn't discounting 15 to 20% earnings per share growth. It ended up discounting like 40 to 50%.”

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The claim, plainly

Following the dot-com bubble burst, Cisco Systems compounded its earnings at roughly 15% annually over the subsequent 15 to 20 years.

a quote alone can be ambiguous, so this restates it with the references and context of the conversation around it resolved. AI-written; the tape below the player is the source.

Assessment

Michael Batnick's statement that Cisco compounded its earnings at 'something like 15%' over the 15 to 20 years following the dot-com crash is accurate under specific metrics (namely Diluted EPS from the post-bubble trough), but overstates growth across broader definitions. From the post-bubble trough (FY 2002 to FY 2017, 15 years), Cisco's GAAP Diluted EPS compounded at 14.50% per year, matching the ~15% figure. However, measured from the dot-com peak (FY 2000), GAAP Diluted EPS compounded at 11.08% over 15 years (FY 2015) and 10.50% over 20 years (FY 2020). When measured by total Net Income rather than per-share earnings, Cisco's CAGR ranged from 7.46% to 8.41% from the peak, and 9.60% to 11.42% from the 2002 trough. Because the ~15% figure holds true for per-share earnings from the bottom of the crash but is a mild overstatement for peak-to-period or total net income metrics, the claim is partially true.

From the FY 2002 trough to FY 2017 (15 years), Cisco's GAAP Diluted EPS grew from $0.25 to $1.90, representing a 14.50% CAGR (~15%).
Over 20 years from the FY 2002 trough (FY 2002 to FY 2022), GAAP Diluted EPS grew to $2.82, a 12.94% CAGR.
Measured from the FY 2000 peak, 15-year (FY 2015) and 20-year (FY 2020) GAAP Diluted EPS grew at 11.08% and 10.50% CAGR, respectively.
Total GAAP Net Income grew at an 8.41% CAGR over 15 years (FY 2000 to FY 2015) and 7.46% over 20 years (FY 2000 to FY 2020).

Checked against

[1] scribd.com [2] cisco.com [3] cisco.com [4] q4cdn.com [5] encyclopedia.com

"Cisco Systems" "net income" "2000" "2001" "2002" "Form 10-K" OR "annual report" Cisco Systems annual report 2000 2001 2002 net income EPS "Cisco Systems" "net income" "2015" "2016" "2017" "2018" "2019" "2020" "Form 10-K"

assessed as of 2026-09-02

This assessment is an AI reading of a public statement, made against the cited references with the confidence shown. It can be wrong. The quote, the tape and the references are all on this page; if something is off, use report an error below. full disclaimer →

Mentioned

Cisco

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Batnick: Cisco stock collapsed post-bubble despite 15% earnings growth

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