Lioness Associates, Inc.

Economic & Corporate Risk/Yield Reports

August 16, 2012  -- Cisco Risk/Yield for 2012

Cisco reported earnings yesterday and the results impressed enough investors that their stock rose approximately 9% today. 

The CSCO 2012 Risk/Yield graph depicts the increasing of yield factors from the middle of August to the beginning of October 2012.

The CSCO 2012 Delta Core/Transient graph illustrates the shift of core from risk to yield and then the momentum into yield.  The red box depicts the point of equilibrium for the delta transient and then the move upward and the delta core line follows a short period later. With Cisco, the move into yield was approximately 200 points — usually, a 400+ point movement would signal more momentum and a better percentage of success.  In this case, both the delta transient and core  are moving onto yield at about the time of earnings and it is at the early stage of the momentum into yield which could signify more gains ahead maybe arising from institutional investors buying into this stock in the following weeks.

Note, both the
Global and the USA economy (see home page) are not indicating any major shifts into risk during the August 15, 2012 period when these earnings were announced. If either of those graphs had a movement into risk, then the reaction to Cisco's earnings would likely not have been the same.  





Disclosure as of 8/16/2012 - Cisco (CSCO) is not part of our portfolio at this time.