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Why There Aren’t Any ‘Sell’ Recommendations on Cisco Stock



Analysts’ recommendations for Cisco

Of the 30 analysts covering Cisco Systems (CSCO), 21 have given the stock “buy” ratings, while nine have given it “holds.” No analysts have given the stock “sells.”

Analysts have set a target price of $58.63 on the stock, which implies a premium of 4.8% based on its closing price of $55.93 on May 16.

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Strong third-quarter results

On May 15, the hardware giant reported that it had exceeded analysts’ fiscal 2019 third-quarter consensus estimates on both the earnings and revenue fronts amid economic unrest due to trade war concerns. The company also provided an impressive earnings forecast for the fourth quarter.

Cisco’s corporate and government orders improved in the third quarter, but its service orders weakened due to its weak spending in the Americas regions. Routing rival Juniper Networks is also suffering from weakness in carrier demand and has anticipated soft sales for its upcoming second-quarter results.

Nevertheless, Cisco’s Catalyst 9000 switches generated strong sales, which helped boost its networking gear business. The company also closed on its acquisition of Luxtera for $660 million and a network infrastructure analytics company called Singularity Networks in the third quarter.

Price target raised by analysts

After Cisco’s better-than-expected third-quarter results and robust guidance, many analysts raised their price targets on its stock. Analysts who have increased their price targets are as follows:

  • UBS to $61 from $56
  • Wells Fargo to $60 from $57
  • Cowen and Company to $65 from $62
  • Credit Suisse to 52 from 47
  • Morgan Stanley to $51 from $49
  • Jefferies to $62 from $55

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