In the latest trading session, Cisco Systems (CSCO) closed at $71.39, marking a +1.08% move from the previous day. The stock lagged the S&P 500's daily gain of 1.23%. At the same time, the Dow added 0.72%, and the tech-heavy Nasdaq gained 1.86%.
Coming into today, shares of the seller of routers, switches, software and services had gained 5.07% in the past month. In that same time, the Computer and Technology sector gained 3.49%, while the S&P 500 gained 2.45%.
Investors will be eagerly watching for the performance of Cisco Systems in its upcoming earnings disclosure. In that report, analysts expect Cisco Systems to post earnings of $0.98 per share. This would mark year-over-year growth of 7.69%. In the meantime, our current consensus estimate forecasts the revenue to be $14.78 billion, indicating a 6.78% growth compared to the corresponding quarter of the prior year.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $4.04 per share and revenue of $59.59 billion, indicating changes of +6.04% and +5.18%, respectively, compared to the previous year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Cisco Systems. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Cisco Systems is currently sporting a Zacks Rank of #2 (Buy).
Looking at valuation, Cisco Systems is presently trading at a Forward P/E ratio of 17.47. Its industry sports an average Forward P/E of 17.66, so one might conclude that Cisco Systems is trading at a discount comparatively.
Meanwhile, CSCO's PEG ratio is currently 2.44. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Computer - Networking was holding an average PEG ratio of 1.14 at yesterday's closing price.
The Computer - Networking industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 179, putting it in the bottom 28% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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Cisco Systems, Inc. (CSCO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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