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

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Cisco Systems (CSCO) closed the most recent trading day at $41.62, moving -0.34% from the previous trading session. This change lagged the S&P 500's daily loss of 0.05%. At the same time, the Dow added 0.17%, and the tech-heavy Nasdaq lost 0.01%.

Prior to today's trading, shares of the seller of routers, switches, software and services had gained 10.86% over the past month. This has lagged the Computer and Technology sector's gain of 21.05% and the S&P 500's gain of 21.82% in that time.

Investors will be hoping for strength from CSCO as it approaches its next earnings release, which is expected to be May 13, 2020. The company is expected to report EPS of $0.72, down 7.69% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $11.94 billion, down 7.88% from the year-ago period.

CSCO's full-year Zacks Consensus Estimates are calling for earnings of $3.06 per share and revenue of $48.89 billion. These results would represent year-over-year changes of -1.29% and -5.81%, respectively.

It is also important to note the recent changes to analyst estimates for CSCO. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for 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. Over the past month, the Zacks Consensus EPS estimate has moved 2.92% lower. CSCO is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that CSCO has a Forward P/E ratio of 13.63 right now. This represents a discount compared to its industry's average Forward P/E of 14.3.

Also, we should mention that CSCO has a PEG ratio of 2.52. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Networking was holding an average PEG ratio of 2.85 at yesterday's closing price.

The Computer - Networking industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 67, putting it in the top 27% 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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