Cisco Systems (CSCO)
Technology · NASDAQ · US
Fundamentals
Valuation and ratings
Cisco Systems trades at $109.66, close to the $115.50 our discounted cash flow model puts on the business. On this measure the market and the model broadly agree, so the interesting question is which of them is wrong.
Our moat model scores it 86 out of 100, which is a wide moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 40.4 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Cisco Systems
Cisco Systems, Inc. designs, develops, and sells technologies that help to power, secure, and draw insights from the internet in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. The company offers data center switching; network security, identity and access management, and secure access service edge; threat intelligence, detection, and response solutions; interconnects public and private wireline and mobile networks, delivering connectivity to campus, data center, and branch networks; WEBEX suite, collaboration devices, and contact center; communication platform as a service software, including perpetual licenses, subscription arrangements, and hardware solutions; network assurance, monitoring and analytics, and observability suite; issue resolution, software support, and hardware replacement; professional services, such as planning, design, implementation, and high-value consulting; service and support packages, financing, and managed network services; and regional, national, and international wireline carriers, webscale products, internet, and cable. It also delivers connectivity to campus, data center, and branch networks; wireless products, including indoor and outdoor wireless coverage designed for seamless roaming use of voice, video, and data applications; end-to-end collaboration solutions through cloud, on-premise, or within hybrid cloud environments, transition collaboration solutions from on-premise to the cloud; and network assurance, monitoring and analytics, and observability suite. In addition, it offers technical support and advisory services. The company serves businesses, public institutions, governments, and service providers. It sells its products and services directly, through systems integrators, service providers, resellers, and distributors. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.
CSCO passes 3 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Smart money ownership
23 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Capital Research Global, Capital Research Global Investors$4.96B · 0.8% of book
- Arrowstreet Capital, ARROWSTREET CAPITAL, LIMITED PARTNERSHIP$1.36B · 0.7% of book
- Ken Fisher, Fisher Asset Management, LLC$1.34B · 0.5% of book
- Israel Englander, MILLENNIUM MANAGEMENT LLC$326.34M · 0.1% of book
- Cliff Asness, AQR CAPITAL MANAGEMENT LLC$314.28M · 0.1% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Cisco Systems (CSCO) undervalued?
Against our discounted cash flow estimate of $115.50, CSCO at $109.66 is 5% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own CSCO?
23 of the institutions we track reported a position in CSCO in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is CSCO's P/E ratio?
CSCO trades at 40.4 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
The full research page for CSCO, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.
Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.