Technology

Why Analysts See Cisco Going Even Higher After Earnings

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Cisco Systems Inc. (NASDAQ: CSCO) reported fiscal third-quarter financial results after the markets closed on Wednesday. The company had incredible earnings and investors were thrilled. As a result, analysts are seeing this stock going even higher.

24/7 Wall St. has included some highlights from the earnings report, as well as what analysts are saying about Cisco after the fact.

The company said it had $0.57 in earnings per share (EPS) on $12 billion in revenue. That compares to consensus estimates from Thomson Reuters of $0.55 in EPS on revenue of $11.97 billion. In the same period of last year, Cisco posted EPS of $0.54 and $12.14 billion in revenue.

Deferred revenue for the quarter was $15.3 billion, up 8% in total from last year, with deferred product revenue up 9%, driven largely by subscription-based and software offerings, and deferred service revenue up 7%.

In terms of the outlook for the fiscal fourth quarter, the company expects to have EPS in the range of $0.59 to $0.61 and a gross margin in the range of 63% to 64%. The consensus estimates for the quarter call for $0.58 in EPS on $12.42 billion in revenue.


The company saw its stock rise after the networking giant beat earnings and managed to give a positive (or better than negative) update about China concerns.

Analysts weighed in on the stock:

  • Merrill Lynch reiterated a Neutral rating with a $30 price objective.
  • Barclays has an Overweight rating and raised its price target to $31 from $29.
  • Cowen has an Outperform rating and raised its price target from $37 to $39.
  • Jefferies has a Buy rating and raised its price target to $30.75 from $27.50.
  • RBC has an Outperform rating and raised its price target price to $33 from $31.
  • BMO has an Outperform rating and raised its price target from $30 to $32.
  • Credit Suisse has an Underperform rating and raised its target to $24 from $22.
  • Deutsche Bank raised its price target to $35 from $33.
  • FBN Securities has an Outperform rating and raised its price target to $32.
  • MKM has a Neutral rating and raised its price target from $28 to $30.
  • Raymond James has an Outperform rating and raised its price target to $31 from $28.
  • UBS has a Buy rating and raised its price target price to $30.
  • Wunderlich raised its price target to $27 from $24.

Shares of Cisco ended the week at $27.97. The stock has a consensus analyst price target of $30.96 and a 52-week trading range of $22.46 to $29.62.

 

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