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Cisco Systems
(NASDAQ:CSCO)
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Rating:71Outperform
Price Target:
$123.00
▲(7.73% Upside)
Action:Reiterated
Date:08/17/26
The score is driven primarily by strong underlying financial quality (high margins and solid cash conversion) and a positive FY27 outlook from the earnings call (record results and strong AI/networking order momentum). Offsetting factors are softer near-term technicals (below 20/50-day averages with subdued RSI/Stoch) and a premium valuation (P/E ~33) alongside noted margin and order-to-revenue timing risks.
Positive Factors
AI and Networking Demand
Strong demand across hyperscalers, enterprises, and service providers supports a durable networking cycle. Cisco’s AI infrastructure traction and broad order growth could expand its addressable market as AI deployments require higher-capacity, secure networks.
Negative Factors
Higher Leverage Reduces Financial Flexibility
The material increase in debt relative to equity makes Cisco’s balance sheet less conservative than its prior profile. Higher leverage can constrain flexibility for acquisitions, investment, or shareholder distributions if operating conditions weaken or cash flows become volatile.
Read all positive and negative factors
Positive Factors
Negative Factors
AI and Networking Demand
Strong demand across hyperscalers, enterprises, and service providers supports a durable networking cycle. Cisco’s AI infrastructure traction and broad order growth could expand its addressable market as AI deployments require higher-capacity, secure networks.
Read all positive factors
Cisco Systems Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
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The Fly
The FlyCisco Systems (CSCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$437.66B
Dividend Yield1.49%
Average Volume (3M)22.24M
Price to Earnings (P/E)33.0
Beta (1Y)0.93
Revenue Growth11.77%
EPS Growth27.65%
CountryUS
Employees86,200
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)3.36
Shares Outstanding3,941,434,600
10 Day Avg. Volume19,788,162
30 Day Avg. Volume22,238,835
Financial Highlights & Ratios
PEG Ratio1.09
Price to Book (P/B)8.98
Price to Sales (P/S)7.13
P/FCF Ratio35.35
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$141.21Price Target Upside23.69% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering17
EPS Forecast (FY)5.13
Revenue Forecast (FY)$72.91B
Cisco Systems Business Overview & Revenue Model
Company Description
Cisco Systems, Inc. (CSCO) is a networking and cybersecurity technology company that designs, manufactures, and sells networking hardware, software, and services used to build, secure, and operate enterprise and service-provider networks. Its offe...
How the Company Makes Money
Cisco makes money primarily by selling technology products and by providing software and services that are increasingly delivered via subscriptions. A major revenue stream comes from networking products—such as switches, routers, wireless access p...
Cisco Systems Earnings Call Summary
Earnings Call Date:Aug 12, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Nov 18, 2026
Earnings Call Sentiment Positive
The call communicates strong, broad-based demand and execution — record revenue, robust product and hyperscaler momentum, meaningful design wins, operating leverage, and strong cash returns. Key challenges include gross margin headwinds driven by a higher hardware mix and memory costs, flat services growth, modest recurring revenue expansion, and timing/linearity risks between large hyperscaler orders and revenue recognition. Management positions FY27 guidance conservatively while emphasizing durable secular drivers (Agentic AI, networking super cycle) and supply-chain actions to support continued growth.Positive Updates
Record Fiscal Year and Quarter Revenue
FY26 revenue $63.3B, up 12% YoY; Q4 revenue $17.3B, up 18% YoY — both record results for Cisco.
Negative Updates
Gross Margin Pressure from Hardware Mix and Memory Costs
Q4 non-GAAP gross margin 66.3%, down 210 bps YoY (up 30 bps QoQ). Non-GAAP product gross margin 64.8%, down 270 bps YoY, attributed to a higher hardware mix and memory costs.
Read all updates
Q4-2026 Updates
Positive
Negative
Record Fiscal Year and Quarter Revenue
FY26 revenue $63.3B, up 12% YoY; Q4 revenue $17.3B, up 18% YoY — both record results for Cisco.
Read all positive updates
Company Guidance
Cisco's guidance for FY27: Q1 revenue of $18.0–$18.2B, non‑GAAP gross margin 65%–66%, non‑GAAP operating margin 35.5%–36.5%, non‑GAAP EPS $1.32–$1.34 and an assumed non‑GAAP tax rate of ~18.5% (Q1 is expected to be roughly 25% of annual revenue); full‑year FY27 revenue guided to $72.2–$73.4B with non‑GAAP EPS of $5.05–$5.11, management indicating an implied full‑year non‑GAAP operating margin of about 35% and projecting AI infrastructure revenue of $7.5B in FY27.Cisco Systems Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
70
Positive
Cash Flow
72
Positive
| Breakdown | Jul 2026 | Jul 2025 | Jul 2024 | Jul 2023 | Jul 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 63.33B | 56.65B | 53.80B | 57.00B | 51.56B |
| Gross Profit | 40.86B | 36.79B | 34.83B | 35.75B | 32.25B |
| EBITDA | 20.02B | 15.38B | 15.75B | 17.47B | 16.79B |
| Net Income | 13.27B | 10.18B | 10.32B | 12.61B | 11.81B |
Balance Sheet | |||||
| Total Assets | 129.64B | 122.29B | 124.41B | 101.85B | 94.00B |
| Cash, Cash Equivalents and Short-Term Investments | 7.22B | 16.11B | 17.85B | 26.15B | 19.27B |
| Total Debt | 29.53B | 28.09B | 30.97B | 8.39B | 10.56B |
| Total Liabilities | 79.35B | 75.45B | 78.96B | 57.50B | 54.23B |
| Stockholders Equity | 50.28B | 46.84B | 45.46B | 44.35B | 39.77B |
Cash Flow | |||||
| Free Cash Flow | 12.77B | 13.29B | 10.21B | 19.04B | 12.75B |
| Operating Cash Flow | 14.18B | 14.19B | 10.88B | 19.89B | 13.23B |
| Investing Cash Flow | -3.48B | 1.73B | -20.48B | -5.11B | 1.55B |
| Financing Cash Flow | -12.35B | -15.81B | 6.84B | -11.63B | -15.96B |
Cisco Systems Technical Analysis
Neutral
114.17
Price Trends
116.10
Negative
107.97
Positive
92.36
Positive
Market Momentum
-1.20
Positive
42.49
Neutral
5.87
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSCO, the sentiment is Neutral. The current price of 114.17 is below the 20-day moving average (MA) of 116.07, below the 50-day MA of 116.10, and above the 200-day MA of 92.36, indicating a neutral trend. The MACD of -1.20 indicates Positive momentum. The RSI at 42.49 is Neutral, neither overbought nor oversold. The STOCH value of 5.87 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CSCO.
Cisco Systems Risk Analysis
Cisco Systems disclosed 38 risk factors in its most recent earnings report. Cisco Systems reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Cisco Systems Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
86 Outperform | $237.93B | 58.77 | 30.78% | ― | 32.57% | 24.40% | |
80 Outperform | $21.78B | 30.29 | 19.86% | ― | 9.41% | 10.59% | |
78 Outperform | $112.63B | 53.67 | 187.95% | ― | 18.77% | 12.93% | |
78 Outperform | $291.66B | 300.73 | 6.30% | ― | 19.51% | -33.05% | |
71 Outperform | $437.66B | 33.05 | 25.14% | 1.45% | 11.77% | 27.65% | |
70 Outperform | $70.78B | 49.03 | 6.12% | 1.17% | 23.33% | 2.87% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
CSCO
Cisco Systems
111.04
45.26
68.81%
FFIV
F5, Inc.
384.63
68.93
21.83%
FTNT
Fortinet
153.51
75.87
97.72%
PANW
Palo Alto Networks
357.87
173.32
93.91%
ANET
Arista Networks
188.65
55.61
41.80%
HPE
Hewlett Packard Enterprise
53.45
31.35
141.86%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.