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Cisco Shares Trade Near 52-Week High: What's Next for CSCO Investors?
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Key Takeaways
CSCO stock is up 17% YTD and nearing its 52-week high of $69.78.
Cisco secured $1B in AI infrastructure orders early and expanded its NVIDIA and ServiceNow partnerships.
Security demand boosts CSCO with new solutions and Splunk integration, though valuation concerns persist.
Cisco Systems (CSCO - Free Report) shares closed at $69.27 on Wednesday, slightly lower than the 52-week high of $69.78, which it hit on June 30. Year to date (YTD), CSCO shares have appreciated 17%, beating the Zacks Computer & Technology sector as well as close peer Extreme Networks (EXTR - Free Report) . The broader sector and Extreme Networks shares have appreciated 7% and 8.3%, respectively, over the same timeframe.
Cisco’s aggressive AI push and growing security dominance have been major growth drivers. Cisco secured AI infrastructure orders worth more than $1 billion to date in fiscal 2025, a quarter ahead of schedule. The momentum is expected to continue in the near term thanks to an expanding portfolio and collaboration with NVIDIA (NVDA - Free Report) .
The company is expanding its AI portfolio for data centers with new solutions like the Unified Nexus Dashboard, Cisco Intelligent Packet Flow, configurable AI PODs and 400G bidirectional (BiDi) optics. Moreover, Cisco’s expanded partnership with NVIDIA, under which the companies plan to offer solutions that help build AI-ready data center networks, is a game changer.
CSCO Stock’s Performance
Image Source: Zacks Investment Research
The stock is currently trading above the 50-day and the 200-day moving averages, indicating a bullish trend.
CSCO Stock Trades Above the 50-Day & 200-Day SMAs
Image Source: Zacks Investment Research
CSCO’s Growing Security Business is a Key Catalyst
Cisco’s security business is benefiting from strong demand for both Cisco Secure Access, Hypershield and XDR. In third-quarter fiscal 2025, orders grew double-digit, and the momentum is expected to continue as Splunk’s solutions continue to gain traction. The acquisition of Snap Attack enhances Splunk’s capability.
Cisco Secure AI Factory with NVIDIA is founded on the NVIDIA Spectrum-X Ethernet networking platform. Security is at the core of the solution and helps enterprises simplify, deploy, manage and secure AI infrastructure at any scale. NVIDIA Spectrum-X Ethernet networking based on Cisco Silicon One supports NX-OS, Nexus Hyperfabric AI and SONiC deployments.
Cisco’s partnership with ServiceNow (NOW - Free Report) is also noteworthy in this regard. The companies are combining Cisco’s AI Defense capabilities with ServiceNow SecOps to offer more holistic AI risk management and governance.
Cisco’s strategy of infusing AI across Security platforms and developing Agentic capabilities across the portfolio is a key catalyst. In May, Cisco unveiled Duo Identity and Access Management (IAM) solutions that help enterprises fight continuing identity-based attacks. Duo IAM strengthens Cisco’s approach to user-friendly Zero Trust security.
In June, the company announced enhanced security solutions embedded deep into its networking infrastructure that will help companies implement zero-trust architectures. Cisco’s Hybrid Mesh Firewall and Universal Zero Trust Network Access (ZTNA) solutions simplify policy management, enhance visibility and enable enterprises to scale securely.
CSCO Offers Positive 2025 Guidance
For fiscal 2025, CSCO expects revenues to be $56.5-$56.7 billion, up from the previous guidance of $56-$56.5 billion. Non-GAAP earnings are now expected between $3.77 per share and $3.79 per share, better than the previous guidance of $3.68-$3.74 per share.
The Zacks Consensus Estimate for CSCO’s fiscal 2025 revenues is pegged at $56.59 billion, indicating growth of 5.18% on a year-over-year basis. The consensus mark for CSCO’s fiscal 2025 earnings is currently pegged at $3.79 per share, unchanged over the past 30 days, indicating year-over-year growth of 1.61%.
Cisco shares are trading at a premium, as suggested by the Value Score of D. In terms of the forward 12-month price/sales, CSCO is trading at a premium of 4.65X, higher than the Zacks Computer Networks industry’s 4.54.
Price/Sales Ratio (F12M)
Image Source: Zacks Investment Research
Cisco shares are trading at a premium compared to Extreme Networks. In terms of the forward 12-month P/S, Extreme Networks shares are trading at 1.97X.
Here’s Why Cisco Stock is a Hold
An expanding portfolio makes Cisco well-positioned for sustained growth in an evolving tech landscape. AI push is noteworthy, along with a growing footprint in the security space. These trends bode well for CSCO’s long-term prospects. So, investors who currently hold the stock should continue to do so.
However, a challenging macroeconomic condition due to uncertainty over tariffs, as well as stiff competition in the networking and security domain, is expected to hurt Cisco’s prospects in the near term. A stretched valuation is a concern.
Image: Bigstock
Cisco Shares Trade Near 52-Week High: What's Next for CSCO Investors?
Key Takeaways
Cisco Systems (CSCO - Free Report) shares closed at $69.27 on Wednesday, slightly lower than the 52-week high of $69.78, which it hit on June 30. Year to date (YTD), CSCO shares have appreciated 17%, beating the Zacks Computer & Technology sector as well as close peer Extreme Networks (EXTR - Free Report) . The broader sector and Extreme Networks shares have appreciated 7% and 8.3%, respectively, over the same timeframe.
Cisco’s aggressive AI push and growing security dominance have been major growth drivers. Cisco secured AI infrastructure orders worth more than $1 billion to date in fiscal 2025, a quarter ahead of schedule. The momentum is expected to continue in the near term thanks to an expanding portfolio and collaboration with NVIDIA (NVDA - Free Report) .
The company is expanding its AI portfolio for data centers with new solutions like the Unified Nexus Dashboard, Cisco Intelligent Packet Flow, configurable AI PODs and 400G bidirectional (BiDi) optics. Moreover, Cisco’s expanded partnership with NVIDIA, under which the companies plan to offer solutions that help build AI-ready data center networks, is a game changer.
CSCO Stock’s Performance
Image Source: Zacks Investment Research
The stock is currently trading above the 50-day and the 200-day moving averages, indicating a bullish trend.
CSCO Stock Trades Above the 50-Day & 200-Day SMAs
Image Source: Zacks Investment Research
CSCO’s Growing Security Business is a Key Catalyst
Cisco’s security business is benefiting from strong demand for both Cisco Secure Access, Hypershield and XDR. In third-quarter fiscal 2025, orders grew double-digit, and the momentum is expected to continue as Splunk’s solutions continue to gain traction. The acquisition of Snap Attack enhances Splunk’s capability.
Cisco Secure AI Factory with NVIDIA is founded on the NVIDIA Spectrum-X Ethernet networking platform. Security is at the core of the solution and helps enterprises simplify, deploy, manage and secure AI infrastructure at any scale. NVIDIA Spectrum-X Ethernet networking based on Cisco Silicon One supports NX-OS, Nexus Hyperfabric AI and SONiC deployments.
Cisco’s partnership with ServiceNow (NOW - Free Report) is also noteworthy in this regard. The companies are combining Cisco’s AI Defense capabilities with ServiceNow SecOps to offer more holistic AI risk management and governance.
Cisco’s strategy of infusing AI across Security platforms and developing Agentic capabilities across the portfolio is a key catalyst. In May, Cisco unveiled Duo Identity and Access Management (IAM) solutions that help enterprises fight continuing identity-based attacks. Duo IAM strengthens Cisco’s approach to user-friendly Zero Trust security.
In June, the company announced enhanced security solutions embedded deep into its networking infrastructure that will help companies implement zero-trust architectures. Cisco’s Hybrid Mesh Firewall and Universal Zero Trust Network Access (ZTNA) solutions simplify policy management, enhance visibility and enable enterprises to scale securely.
CSCO Offers Positive 2025 Guidance
For fiscal 2025, CSCO expects revenues to be $56.5-$56.7 billion, up from the previous guidance of $56-$56.5 billion. Non-GAAP earnings are now expected between $3.77 per share and $3.79 per share, better than the previous guidance of $3.68-$3.74 per share.
The Zacks Consensus Estimate for CSCO’s fiscal 2025 revenues is pegged at $56.59 billion, indicating growth of 5.18% on a year-over-year basis. The consensus mark for CSCO’s fiscal 2025 earnings is currently pegged at $3.79 per share, unchanged over the past 30 days, indicating year-over-year growth of 1.61%.
Cisco Systems, Inc. Price and Consensus
Cisco Systems, Inc. price-consensus-chart | Cisco Systems, Inc. Quote
Cisco Shares Are Overvalued
Cisco shares are trading at a premium, as suggested by the Value Score of D. In terms of the forward 12-month price/sales, CSCO is trading at a premium of 4.65X, higher than the Zacks Computer Networks industry’s 4.54.
Price/Sales Ratio (F12M)
Image Source: Zacks Investment Research
Cisco shares are trading at a premium compared to Extreme Networks. In terms of the forward 12-month P/S, Extreme Networks shares are trading at 1.97X.
Here’s Why Cisco Stock is a Hold
An expanding portfolio makes Cisco well-positioned for sustained growth in an evolving tech landscape. AI push is noteworthy, along with a growing footprint in the security space. These trends bode well for CSCO’s long-term prospects. So, investors who currently hold the stock should continue to do so.
However, a challenging macroeconomic condition due to uncertainty over tariffs, as well as stiff competition in the networking and security domain, is expected to hurt Cisco’s prospects in the near term. A stretched valuation is a concern.
CSCO currently carries a Zacks Rank #3 (Hold), suggesting that it may be wise for investors to wait for a better point to start accumulating the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.