Why Cisco Stock Is Down The company reported revenue dips as enterprise IT spending dropped. Although cloud-based services were more widely used during the global lockdowns, the shift to virtual work made Cisco services less necessary in office buildings.
Why is Cisco (CSCO) stock down 13% today?
Cisco (NASDAQ: CSCO) stock is tumbling 13% in morning trading after the company reported lower-than-expected revenue for its fiscal third quarter and slashed its full-year profit guidance. For its Q3, which ended last month, earnings per share, excluding certain items, came in at 87 cents, versus analysts’ average estimate of 86 cents.
Did Cisco’s orders increase just 8% last quarter?
And another firm, Evercore, told Barron’s that Cisco’s orders increased just 8% year over year last quarter, down from a 33% YOY gain during the previous quarter. On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
How did Cisco’s earnings perform in Q1 ’22?
Cisco had reported strong Q1 ’22 earnings in late November (Cisco’s fiscal year ends in July), with revenue rising from $11.9 billion in Q1 ’21 to $12.9 billion in Q1 ’22, driven primarily by rising product sales. Further, with COGS and operating expenses rising at a slower rate, operating margins jumped from 21.5% to 26.7% over this period.
Is Cisco the most complicated business in the world?
With $51 billion in annual revenue, Cisco is a more complicated business than smaller rivals like Arista that generated $3.1 billion over the last year. On the bright side, Cisco's product backlog ended the quarter at over $15 billion, with product remaining performance obligations up 13%.
Is CSCO a good stock to buy now?
Cisco's stock now trades at 13 times the midpoint of its EPS estimate for fiscal 2022, and it pays a high forward dividend yield of 3.6%. That low valuation and high yield might limit its downside potential, but it will likely remain in the penalty box until its revenue growth and margins stabilize again.
Why is Cisco stock so cheap?
Why Cisco Stock Is Down. The company reported revenue dips as enterprise IT spending dropped. Although cloud-based services were more widely used during the global lockdowns, the shift to virtual work made Cisco services less necessary in office buildings.
Is Cisco losing market share?
While Cisco has remained the market leader in the ethernet switch market in the past 9 years, it has been steadily losing market share. On the other hand, the market share of Huawei, Arista (ANET) and others have increased.
Will Cisco stock recover?
The 21 analysts offering 12-month price forecasts for Cisco Systems Inc have a median target of 52.00, with a high estimate of 65.00 and a low estimate of 40.00. The median estimate represents a +19.60% increase from the last price of 43.48.
What is the future of Cisco?
3. There's sluggish growth in Cisco's collaboration businessProduct RevenueQ1 2022Growth (YOY)Hybrid work$1.11 billion(9%)End-to-end security$895 million7%Internet for the future$1.37 billion42%Optimized application experiences$181 million12%1 more row•Mar 30, 2022
Is Cisco a good long term investment?
Cisco's stock trades at 16 times forward earnings. Its business is big and boring, but it's firmly profitable, its growth is stable, and it generates plenty of cash. That stability should make Cisco a compelling stock to own as rising interest rates spark a retreat toward income-generating value stocks.
Is Cisco a buy or sell?
For example, a company with a P/E ratio of 25 and a growth rate of 20% would have a PEG ratio of 1.25 (25 / 20 = 1.25)....Momentum Scorecard. More Info.Zacks RankDefinitionAnnualized Return1Strong Buy25.08%2Buy18.56%3Hold10.15%4Sell5.79%2 more rows
Who is Cisco's biggest competitor?
Juniper Networks It's among the pioneer manufactures of routers and switches which primarily compete with Cisco products. The global router and switch market is expected to be worth $41.03 billion by 2022, growing at a CAGR of 7.7% from 2021 to 2026.
Is Cisco still leader in networking?
Cisco is the worldwide leader in networking that transforms how people connect, communicate, and collaborate. Our technology is changing the nature of work and the way we live. Founded in 1984, Cisco pioneered the development of Internet Protocol (IP)-based networking technologies.
What is CSCO price target?
Stock Price Target CSCOHigh$65.00Median$52.00Low$40.00Average$52.85Current Price$45.62
Is Cisco stock undervalued?
Despite a low-single-digit top line growth, the company improved its profit margin, which snowballed into higher earnings per share and return on equity for its Q1 2022. CSCO is currently undervalued in comparison to its peers and offers a higher dividend yield.
Does Cisco pay a dividend?
Cisco pays dividends every 3 months or 4 times per year. Each quarterly dividend payment is one-fourth of the annual forward rate.
What happened
Shares of Cisco Systems ( CSCO 2.58% ) fell as much as 5.5% on Wednesday morning, following the networking equipment giant's second-quarter earnings report. The stock had recovered to a 4% decline as of 11:50 a.m. EST.
So what
Cisco's adjusted second-quarter earnings rose 3% year over year to $0.79 per diluted share. Revenues held steady at $12 billion. Your average analyst would have settled for earnings near $0.76 per share on sales in the vicinity of $11.9 billion, so Cisco exceeded Wall Street's expectations by a small margin.
Now what
The report was solid, guidance pointed slightly above the Street's estimates, and Cisco boosted its dividends. The typical reaction to reports like that is rising share prices, not a multibillion-dollar dent in the company's market cap. What's going on here?
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Bulls Say
Cisco's one-stop-shop ecosystem, from switches to data analytics, should remain valued as more networking customers migrate to hybrid clouds.
Bulls Say
Cisco's one-stop-shop ecosystem, from switches to data analytics, should remain valued as more networking customers migrate to hybrid clouds.
