Cisco Systems (CSCO) closed at $39.06 in the latest trading session, marking a -1.86% move from the prior day. This change lagged the S&P 500's daily loss of 1.51%. Meanwhile, the Dow lost 1.69%, and the Nasdaq, a tech-heavy index, lost 1.53%.
Heading into today, shares of the seller of routers, switches, software and services had gained 0.58% over the past month, outpacing the Computer and Technology sector's loss of 14.82% and the S&P 500's loss of 18.13% in that time.
CSCO will be looking to display strength as it nears its next earnings release. In that report, analysts expect CSCO to post earnings of $0.75 per share. This would mark a year-over-year decline of 3.85%. Meanwhile, our latest consensus estimate is calling for revenue of $12.25 billion, down 5.46% from the prior-year quarter.
CSCO's full-year Zacks Consensus Estimates are calling for earnings of $3.16 per share and revenue of $49.93 billion. These results would represent year-over-year changes of +1.94% and -3.8%, respectively.
Any recent changes to analyst estimates for CSCO should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 3.92% lower. CSCO is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that CSCO has a Forward P/E ratio of 12.61 right now. For comparison, its industry has an average Forward P/E of 13.08, which means CSCO is trading at a discount to the group.
Also, we should mention that CSCO has a PEG ratio of 2.34. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CSCO's industry had an average PEG ratio of 2.71 as of yesterday's close.
The Computer - Networking industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 185, putting it in the bottom 28% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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