U.S. Markets closed

Cisco Systems (CSCO) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
Medtronic (MDT) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

In the latest trading session, Cisco Systems (CSCO) closed at $44.06, marking a -0.32% move from the previous day. This move lagged the S&P 500's daily gain of 0.01%. Elsewhere, the Dow gained 0.35%, while the tech-heavy Nasdaq added 0.45%.

Prior to today's trading, shares of the seller of routers, switches, software and services had lost 3.39% over the past month. This has was narrower than the Computer and Technology sector's loss of 5.51% and the S&P 500's loss of 7.29% in that time.

Wall Street will be looking for positivity from CSCO as it approaches its next earnings report date. This is expected to be February 13, 2019. In that report, analysts expect CSCO to post earnings of $0.72 per share. This would mark year-over-year growth of 14.29%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $12.38 billion, up 4.14% from the year-ago period.

CSCO's full-year Zacks Consensus Estimates are calling for earnings of $3.02 per share and revenue of $51.45 billion. These results would represent year-over-year changes of +16.15% and +4.29%, respectively.

Investors should also note any recent changes to analyst estimates for CSCO. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.01% higher within the past month. CSCO is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note CSCO's current valuation metrics, including its Forward P/E ratio of 14.66. This represents a discount compared to its industry's average Forward P/E of 18.96.

Also, we should mention that CSCO has a PEG ratio of 2.31. 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. Computer - Networking stocks are, on average, holding a PEG ratio of 2.11 based on yesterday's closing prices.

The Computer - Networking industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 102, which puts it in the top 40% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.