Will Cisco Systems Outperform Again in Q3?

By Chris Lange Published May 13, 10:39AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Will Cisco Systems Outperform Again in Q3? — © aparejador / Flickr

Cisco Systems Inc. (NASDAQ: CSCO | CSCO Price Prediction) is scheduled to release its fiscal third-quarter financial results after the markets close on Wednesday. The consensus estimates call for $0.71 in earnings per share (EPS) and revenue of $11.88 billion. In the same period of last year, the company said it had EPS of $0.78 and $12.96 billion in revenue. The company has beat earnings expectations by a penny or so per share in the past four periods.

Cisco previously issued guidance for the fiscal third quarter calling for EPS in the range of $0.79 to $0.81 and revenues declining 1.5% to 3.5% year over year.

In the fiscal second quarter, total revenue decreased 4% year over year, with product revenue down 6% and service revenue up 5%. Revenue by geographic segment was: Americas down 5%, EMEA down 3% and APJC down 1%. Product revenue performance was led by growth in Security, up 9%. Infrastructure Platforms and Applications revenue were each down 8%.

At the same time, deferred revenue was $18.7 billion, up 8% in total, with deferred product revenue up 19%. Deferred service revenue was up 2%.

[nativounit]

Excluding Wednesday’s move, Cisco stock had underperformed the broad markets with shares down nearly 10% year to date. In the past 52 weeks, it was down closer to 16%.

A few analysts weighed in on Cisco ahead of the report:

KeyCorp has a Sector Weight rating.
MKM Partners has a Neutral rating and a $40 target.
Barclays has a Buy rating with a $48 target price.
Credit Suisse rates it as Neutral with a $40 price target.
Raymond James rates it as Outperform with a $48 target.
Wells Fargo has an Overweight rating and a $50 target price.

Cisco Systems stock traded down less than 1% to $43.01 on Wednesday, in a 52-week range of $32.40 to $58.28. The consensus price target is $46.19.

[recirclink id=706497][wallst_email_signup]

About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.