Cisco Systems CSCO has launched the Cisco AI Defense to enable and safeguard AI transformation within enterprises. With exponential growth of AI, risks like data leaks, misuse of AI tools and sophisticated threats are on the rise. Cisco AI Defense aims to address these challenges using its advanced network visibility and control, ensuring enterprises can adopt AI while staying protected against security concerns.
With this launch, Cisco Systems has expanded its cybersecurity portfolio, which remains a standout, with strong demand for products like XDR, Secure Access and Multicloud Defense suites.
CSCO shares have risen 18.8% in the trailing 12 months, underperforming the Zacks Computer and Technology sector’s return of 31.5% but outperforming the Zacks Computer – Networking industry’s return of 17.8%.
Cisco Systems’ expanding footprint across diverse sectors, including cybersecurity, AI infrastructure, cloud solutions and enterprise networking, is driving its growth and aiding its share performance.
One-Year Performance
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The stock is currently trading above the 50-day and 200-day moving averages, indicating a bullish trend.
CSCO Stock Trades Above the 50 & 200-Day SMAs
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However, the CSCO stock is not so cheap, as its Value Score of C suggests a stretched valuation at this moment.
In terms of the forward 12-month price/sales, CSCO is trading at a premium of 4.2X, higher than its median of 3.7X and the industry’s 3.83X.
Price/Sales Ratio (F12M)
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Expanding Portfolio Bodes Well for CSCO
CSCO’s diverse and robust portfolio across cloud computing, software, security and AI is driving its market leadership and top-line growth.
In cloud computing, CSCO’s cutting-edge solutions, like the 8000 Series Routers and Nexus Dashboard, facilitate seamless multi-cloud connectivity and management, positioning CSCO as a key player in the space.
Rising demand for Cisco Systems’ Nexus switches, especially the 400-gig and 800-gig models powered by Silicon One, is further solidifying its competitive edge in private cloud infrastructure.
In AI, CSCO’s NVIDIA NVDA-powered AI server and AI PODs, integrated with NVIDIA’s AI Enterprise cloud-native software and managed via Cisco Intersight, simplify and de-risk AI infrastructure.
CSCO’s wireless innovations, with Wi-Fi 7 access points and built-in AI, offer secure and adaptable wireless connectivity. Integrated with Cisco Spaces, these solutions optimize and enable smart workplaces.
CSCO’s software portfolio includes innovative platforms like AppDynamics for full-stack observability and Cisco SecureX for integrated security management. Its collaboration tools, such as Webex AI Agent, AI Agent Studio and Cisco AI Assistant for the Webex Contact Center, leverage conversational intelligence and automation to boost customer satisfaction and productivity.
CSCO has signed a 5.5-year whole portfolio agreement with MGM Resorts International MGM, providing access to its extensive software portfolio. The deal is enhancing guest experiences and operations across MGM properties with its advanced solutions, highlighting Cisco’s growing client base and industry impact.
CSCO’s 2025 Guidance Positive
For second-quarter fiscal 2025, Cisco Systems expects revenues of $13.75-$13.95 billion. Non-GAAP earnings per share are expected between 89 cents and 91 cents per share.
For fiscal 2025, CSCO expects revenues of $55.3-$56.3 billion. Non-GAAP earnings are expected between $3.60 and $3.66 per share.
CSCO’s 2025 Revenue Estimates Indicate Y/Y Growth
The Zacks Consensus Estimate for CSCO’s second-quarter fiscal 2025 revenues is pegged at $13.86 billion, indicating growth of 8.36% on a year-over-year basis.
The consensus mark for CSCO’s second-quarter fiscal 2025 earnings is pegged at 91 cents per share, which has been unchanged over the past 30 days and indicates year-over-year growth of 4.60%.
The Zacks Consensus Estimate for CSCO’s 2025 revenues is pegged at $55.93 billion, indicating growth of 3.95% on a year-over-year basis.
The consensus mark for CSCO’s 2025 earnings is pegged at $3.65 per share, up by a cent over the past 30 days. The estimate indicates a year-over-year decline of 2.14%.
CSCO beat the Zacks Consensus Estimate for earnings in the trailing four quarters, the average surprise being 4.14%.
Cisco Systems, Inc. Price and Consensus
Cisco Systems, Inc. price-consensus-chart | Cisco Systems, Inc. Quote
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Here’s Why CSCO Stock is a Buy
With its strong partner network, including industry leaders like Meta Platforms, Microsoft MSFT, Lenovo, LTIMindtree and AT&T, Cisco Systems is accelerating innovation and expanding its footprint. A growing portfolio and client base are making CSCO well-positioned for sustained growth in an evolving tech landscape.
CSCO’s strong growth prospects justify its premium valuation.
CSCO currently carries a Zacks Rank #2 (Buy), suggesting that it may be wise for investors to start accumulating the stock now. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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