Cisco Systems ( (CSCO) ) has fallen by -8.88%. Read on to learn why.
Cisco Systems shares slipped 8.88% over the past week, pausing a powerful rally that has lifted the stock over the past year. The pullback comes despite solid fundamentals: the company beat expectations in its latest quarter, with non‑GAAP earnings per share rising more than 23% year on year, and management guiding to a strong 15% revenue increase to about $72.8 billion in fiscal 2027. Wall Street still holds a moderately bullish stance, with a “Moderate Buy” consensus and average 12‑month price targets comfortably above the current share price, signalling that many analysts see room for further gains.
The mixed reaction in the market is driven largely by valuation worries rather than operational weakness. HSBC’s Abhishek Shukla downgraded Cisco Systems to Hold, cutting his target price to $120 and arguing that much of the good news is already in the stock. He expects earnings growth to peak around 2027 and then cool to single‑digit rates from fiscal 2028 onward, which would leave Cisco growing more slowly than some faster‑moving tech peers. That cautious view helped cool enthusiasm and contributed to the recent share‑price decline.
At the same time, more optimistic voices, such as BofA’s Tal Liani, maintain Buy ratings on Cisco Systems. They point to surging networking demand, with segment revenue up over 20% and hyperscaler sales jumping sharply as cloud and AI infrastructure spending remains strong. Cisco expects hyperscaler revenue to nearly double again in fiscal 2027, suggesting ongoing support for growth. For investors, the recent 8.88% drop reflects a tug‑of‑war between impressive business momentum and concerns that the stock may already be pricing in much of that strength, making Cisco a battleground name for those weighing growth potential against valuation risk.