Back to top

Image: Bigstock

Cisco Systems (CSCO) Stock Declines While Market Improves: Some Information for Investors

Read MoreHide Full Article

The latest trading session saw Cisco Systems (CSCO - Free Report) ending at $55.28, denoting a -0.83% adjustment from its last day's close. The stock fell short of the S&P 500, which registered a gain of 0.27% for the day. Meanwhile, the Dow experienced a rise of 0.65%, and the technology-dominated Nasdaq saw an increase of 0.26%.

Shares of the seller of routers, switches, software and services witnessed a gain of 5.13% over the previous month, beating the performance of the Computer and Technology sector with its gain of 2.21% and the S&P 500's gain of 2%.

Market participants will be closely following the financial results of Cisco Systems in its upcoming release. It is anticipated that the company will report an EPS of $0.87, marking a 21.62% fall compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $13.76 billion, down 6.22% from the prior-year quarter.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $3.56 per share and a revenue of $55.61 billion, indicating changes of -4.56% and +3.36%, respectively, from the former year.

Any recent changes to analyst estimates for Cisco Systems should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. As of now, Cisco Systems holds a Zacks Rank of #2 (Buy).

In the context of valuation, Cisco Systems is at present trading with a Forward P/E ratio of 15.67. Its industry sports an average Forward P/E of 14.46, so one might conclude that Cisco Systems is trading at a premium comparatively.

Investors should also note that CSCO has a PEG ratio of 3.58 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Computer - Networking industry had an average PEG ratio of 1.16 as trading concluded yesterday.

The Computer - Networking industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 100, this industry ranks in the top 40% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in 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.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Cisco Systems, Inc. (CSCO) - free report >>

Published in