Don’t overlook Cisco in search for ‘new Google’

Amid recent share falls, there has been at least one bright spot recently. Wall Street's most eagerly awaited technology flotation since Google’s listing in 2004 more than met investor expectations, with shares in software company VMware leaping 86% on their 14th August debut. There are market expectations that VMware, a pioneer in ‘virtualisation technology,’ could be the ‘new Google.’ However, more established technology companies, such as computer network equipment maker Cisco Systems, should not be overlooked, according to Neil Rogan, Manager of the Gartmore Global Focus Fund and the Gartmore SICAV Global Focus Fund.

Cisco, which last month bought six million shares in VMware from parent EMC, has its own merits, commented Neil. Earlier this month, Cisco announced a 25% jump in quarterly profits and raised its revenue forecast for the year. San Jose-based Cisco is benefiting from strong industry fundamentals, in particular technology spending by large corporations. The company is also tapping into infrastructure spending driven, in particular, by booming telecommunications traffic, both fixed line and mobile. Cisco is held by both the Gartmore Global Focus Fund and the Gartmore SICAV Global Focus Fund. Perhaps in the current climate, technology companies also have a particular appeal – they don’t sell mortgages.