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Cisco Systems (CSCO) Dips More Than Broader Markets: What You Should Know

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Cisco Systems (CSCO - Free Report) closed at $54.77 in the latest trading session, marking a -0.92% move from the prior day. This move lagged the S&P 500's daily loss of 0.02%.

Heading into today, shares of the seller of routers, switches, software and services had gained 4.48% over the past month, outpacing the Computer and Technology sector's gain of 2.65% and the S&P 500's gain of 2.91% in that time.

CSCO will be looking to display strength as it nears its next earnings release, which is expected to be August 18, 2021. On that day, CSCO is projected to report earnings of $0.83 per share, which would represent year-over-year growth of 3.75%. Meanwhile, our latest consensus estimate is calling for revenue of $13.04 billion, up 7.28% from the prior-year quarter.

CSCO's full-year Zacks Consensus Estimates are calling for earnings of $3.20 per share and revenue of $49.68 billion. These results would represent year-over-year changes of -0.31% and +0.76%, respectively.

It is also important to note the recent changes to analyst estimates for CSCO. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. CSCO is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that CSCO has a Forward P/E ratio of 17.25 right now. Its industry sports an average Forward P/E of 15.03, so we one might conclude that CSCO is trading at a premium comparatively.

Meanwhile, CSCO's PEG ratio is currently 2.76. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Computer - Networking industry currently had an average PEG ratio of 3.31 as of yesterday's close.

The Computer - Networking industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 240, which puts it in the bottom 6% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow CSCO in the coming trading sessions, be sure to utilize Zacks.com.


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