Can Cisco Reach $20 Again? (CSCO)

Now that Cisco Cystems Inc. (NASDAQ: CSCO) appears to have put its restructuring in the rear-view mirror, it might be worth looking at whether or not the stock is headed toward $20/share again.

The first thing the company could do is raise its annual dividend above the paltry $0.24/share where it now stands. To help fund that, the company could stop wasting cash on share buybacks. So far, Cisco has spent about $70 billion on buybacks.

The second thing the company could do is make every effort to have a successful turnaround in its operations. If Cisco can succeed at that, then perhaps John Chambers will declare victory and retire.

Cisco shares are trading at around $18.78 in the early afternoon today. The consensus target price for the stock is $21.20 and its forward P/E is 9.65. The 52-week range is $13.30-$22.34. The potential upside from the 52-week low is about 41%.