Cisco Systems (CSCO) Stock Sinks As Market Gains: What You Should Know

In the latest trading session, Cisco Systems (CSCO) closed at $39.20, marking a -0.25% move from the previous day. This change lagged the S&P 500's daily gain of 0.47%. Elsewhere, the Dow gained 0.4%, while the tech-heavy Nasdaq added 0.33%.

Heading into today, shares of the seller of routers, switches, software and services had gained 0.67% over the past month, lagging the Computer and Technology sector's gain of 6.61% and the S&P 500's gain of 3.42% in that time.

Wall Street will be looking for positivity from CSCO as it approaches its next earnings report date. This is expected to be November 12, 2020. In that report, analysts expect CSCO to post earnings of $0.71 per share. This would mark a year-over-year decline of 15.48%. Our most recent consensus estimate is calling for quarterly revenue of $11.88 billion, down 9.74% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.11 per share and revenue of $48.25 billion, which would represent changes of -3.12% and -2.14%, respectively, from the prior year.

Any recent changes to analyst estimates for CSCO should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Within the past 30 days, our consensus EPS projection remained stagnant. CSCO is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, CSCO currently has a Forward P/E ratio of 12.64. This represents a discount compared to its industry's average Forward P/E of 15.45.

We can also see that CSCO currently has a PEG ratio of 1.9. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. CSCO's industry had an average PEG ratio of 2.44 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 205, putting it in the bottom 19% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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