Cisco Systems (CSCO) closed the most recent trading day at $41.15, moving -1.06% from the previous trading session. This change lagged the S&P 500's daily loss of 0.84%. Meanwhile, the Dow lost 0.36%, and the Nasdaq, a tech-heavy index, lost 0.19%.
Prior to today's trading, shares of the seller of routers, switches, software and services had lost 11.64% over the past month. This has was narrower than the Computer and Technology sector's loss of 13.48% and lagged the S&P 500's loss of 10.24% in that time.
Wall Street will be looking for positivity from Cisco Systems as it approaches its next earnings report date. In that report, analysts expect Cisco Systems to post earnings of $0.84 per share. This would mark year-over-year growth of 2.44%. Meanwhile, our latest consensus estimate is calling for revenue of $13.31 billion, up 3.2% from the prior-year quarter.
CSCO's full-year Zacks Consensus Estimates are calling for earnings of $3.53 per share and revenue of $54.07 billion. These results would represent year-over-year changes of +5.06% and +4.87%, respectively.
It is also important to note the recent changes to analyst estimates for Cisco Systems. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Cisco Systems is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, Cisco Systems is holding a Forward P/E ratio of 11.78. Its industry sports an average Forward P/E of 14.89, so we one might conclude that Cisco Systems is trading at a discount comparatively.
Investors should also note that CSCO has a PEG ratio of 1.81 right now. 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. The Computer - Networking was holding an average PEG ratio of 1.81 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 68, putting it in the top 27% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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