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Investing.com - UBS raised its price target on Cisco (NASDAQ:CSCO) to $90.00 from $88.00 on Thursday, while maintaining a Buy rating following the company’s strong fiscal first-quarter results. Cisco shares are currently trading at $76.97, up over 28% year-to-date, and recently surpassed their previous 52-week high of $74.84.InvestingPro data shows Cisco has achieved a perfect Piotroski Score of 9, indicating exceptional financial strength, though the company appears overvalued compared to its Fair Value. InvestingPro offers 10+ additional insights on Cisco’s financial health and valuation metrics.
Cisco reported product orders growth of 13% year-over-year, or 9% excluding hyperscalers, against what UBS described as a tough comparison period. The networking giant recorded $1.3 billion in artificial intelligence (AI) orders during the quarter, representing approximately 50% growth quarter-over-quarter. This growth contributes to Cisco’s overall revenue of $57.7 billion in the last twelve months, with an 8.9% revenue growth rate.
The AI orders were primarily driven by Silicon One-based systems and Acacia-based optics, according to UBS. The firm noted that Cisco expects its AI-related revenue to reach $3 billion in fiscal year 2026, up from $1 billion in fiscal year 2025.
UBS also highlighted that early indicators suggest Cisco’s next-generation Campus solutions are ramping up faster than the previous Cat 9K offerings. The firm believes these two product ramps should increase investor confidence that revenue growth will exceed Cisco’s long-term target of 4%-6% in fiscal years 2026 and 2027. With a market capitalization of $303.3 billion, Cisco remains a dominant player in the Communications Equipment industry.
Despite tight supply across various components including memory, Cisco provided second-quarter gross margin guidance of 67.5%-68.5%, which UBS characterized as "better than feared." The firm’s new $90 price target represents 19 times its calendar year 2027 earnings per share estimate of $4.74, revised up from $4.62. InvestingPro analysis reveals Cisco is trading at a high P/E ratio of 30.4 relative to its near-term earnings growth, with a notably high PEG ratio of 71.9. Cisco is one of 1,400+ US equities with comprehensive Pro Research Reports available, offering clear, actionable intelligence through intuitive visuals and expert analysis for smarter investing decisions.
In other recent news, Cisco has been the focus of several analyst updates following its latest earnings report. Cisco reported first-quarter fiscal 2026 earnings per share of $1.00, surpassing Goldman Sachs’ estimate of $0.99 and exceeding its own guidance range of $0.97-$0.99. This performance was largely attributed to a 15% year-over-year growth in its Networking segment. Rosenblatt Securities increased its price target for Cisco to $100, citing strong demand from hyperscale customers and enterprises investing in artificial intelligence infrastructure. Melius Research also raised its price target to $100, highlighting Cisco’s strong execution in the networking segment, which offsets a 2% year-over-year decline in its security segment. Piper Sandler adjusted its price target to $86, noting consecutive strong quarters for Cisco, driven by AI infrastructure buildout and campus refresh opportunities. Meanwhile, William Blair reiterated its rating on Cisco, following the company’s guidance raise and positive AI outlook for the fiscal year. Goldman Sachs maintained its Neutral rating with a $75 price target, noting the strong AI momentum.
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