CSCO Cisco Systems, Inc. - Fundamental Analysis
NEUTRAL
CSCO Stock | Fundamental Analysis & Investment Insights
NASDAQ
•
Technology
•
Communication Equipment
Current Price
$78.0
Analyst Target
$84.1
+7.8% Upside
52W High
$79.5
52W Low
$52.11
AI Analysis
Powered by advanced machine learning algorithms
Confidence Score
72%
Analysis Accuracy
Cisco Systems trades at a premium valuation with solid profitability and financial discipline, but faces headwinds from lackluster earnings momentum and weakening insider sentiment. While the stock has delivered strong price performance over the past year (+38.1%) and maintains a durable 2.1% dividend yield, recent quarters have shown no earnings surprises and only modest growth, lagging high-flying tech peers. The forward P/E of 20.0x aligns with projected earnings growth, yet the company’s 7.5% YoY revenue growth and declining liquidity ratios suggest limited upside acceleration. Against a sector averaging 20.77% revenue growth and sky-high P/Es driven by AI momentum, Cisco appears fairly valued but not compellingly cheap, especially with insider selling outweighing buys over the last six months.
Key Strengths
Strong profitability with gross margin of 64.83% and operating margin of 23.64%, reflecting pricing power and cost discipline
Attractive dividend yield of 2.10% with a sustainable 62.93% payout ratio, appealing to income-oriented investors
Healthy balance sheet with a Debt/Equity ratio of 0.60, below sector average of 0.74, indicating prudent leverage
Forward P/E of 20.00 is reasonable relative to earnings growth of 6.0%, suggesting fair valuation
Market cap of $307.38B places it among the most stable and liquid names in the tech sector
Key Risks
Revenue growth of 7.5% lags sector average of 20.77%, raising concerns about competitive positioning in high-growth areas like AI and cloud
Insider selling activity totaling $6.04M over the past six months signals lack of confidence among executives
Current ratio of 0.93 and quick ratio of 0.67 indicate tightening liquidity, below the 1.0 threshold for short-term solvency
No earnings beats in the last four quarters with zero average surprise, suggesting guidance conservatism or execution issues
Valuation appears stretched on a P/E basis (30.12) compared to forward growth, especially when contrasted with more innovative peers
AI Fair Value Estimate
Based on comprehensive analysis
$82.5
+5.8% above current price
Performance Snowflake
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Stock Price & Analyst Targets
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Historical Performance Trends
Long-term financial metrics and growth patterns
Valuation Metrics
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Profitability, Growth & Financial Health
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Sector Comparison & Peer Analysis
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Insider Trading & Analyst Ratings
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