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Cisco Systems (CSCO) Gains But Lags Market: What You Should Know

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Cisco Systems (CSCO - Free Report) closed the most recent trading day at $44.13, moving +0.23% from the previous trading session. This change lagged the S&P 500's 0.59% gain on the day. Meanwhile, the Dow gained 0.15%, and the Nasdaq, a tech-heavy index, lost 0.02%.

Coming into today, shares of the seller of routers, switches, software and services had lost 0.25% in the past month. In that same time, the Computer and Technology sector lost 12.83%, while the S&P 500 gained 7.25%.

Investors will be hoping for strength from Cisco Systems as it approaches its next earnings release, which is expected to be August 17, 2022. The company is expected to report EPS of $0.82, down 2.38% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $12.75 billion, down 2.85% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.35 per share and revenue of $51.21 billion. These totals would mark changes of +4.04% and +2.79%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Cisco Systems. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.03% higher. Cisco Systems is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, Cisco Systems is holding a Forward P/E ratio of 13.13. This valuation marks a discount compared to its industry's average Forward P/E of 14.8.

Investors should also note that CSCO has a PEG ratio of 2.02 right now. 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 2.02 as of yesterday's close.

The Computer - Networking industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 100, putting it in the top 40% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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