So Chuck and I both agree that Cisco (NASDAQ:CSCO) is a great company. Its market dominance and innovative nature are beyond reproach, even for a critic of the stock. So far, so good.

But then we get into an argument over valuation. Chuck sees a single quarter of weakness in the core American router market and concludes that this is the reason for a P/E ratio of less than 23. If so, then Mr. Market owns a working crystal ball. Cisco's P/E has dipped below 23 at some point in four of the past eight quarters. That history stretches back far beyond the current credit crunch that purportedly forces customers such as Disney (NYSE:DIS), Wachovia (NYSE:WB), and (NYSE:CRM) to hold off on network upgrades.

Even if you take the lending tightness at face value and see it hurting Cisco's business today, it's just a small bump in the road for Cisco. The company is managed for long-term excellence, and the top brass pays little attention to near-term blips like this one. So AT&T (NYSE:T) didn't buy enough switches last quarter? It'll be back soon enough. In fact, old Ma Bell just placed a long-term order for hundreds of millions of dollars in top-of-the-line Cisco routers.

My esteemed opponent also worries about a very low retained earnings balance on Cisco's balance sheet. He seems to forget that this company wheels and deals with the best of them. If it hadn't been for a slew of major acquisitions over the past three years, Cisco could have held $10 billion in reserves, just like Chuck's spendthrift hero Apple (NASDAQ:AAPL). Just to make sure that we're comparing appropriate fruits here, Apple hasn't spent a dime on mergers and acquisitions in the past five years.

So the choice is yours -- invest in an undisputed market leader with a long-term focus and a willingness to invest in its future, all at historically tempting prices. Or don't. Just don't come back later and complain about missed opportunities.

Further Foolishness:

You're not done with this duel yet! Read the other three arguments, sound off at Motley Fool CAPS, and vote for a winner.

Disney is a current Motley Fool Stock Advisor pick.

Fool contributor Anders Bylund is a Disney shareholder who just can't shut up about Cisco long enough to buy anything. Otherwise, he holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure remains the undisputed king of straight-shooting muckraking.