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Cisco Systems Inc (CSCO) Common Stock USD0.001

Sell:$45.50 Buy:$45.52 Change: $0.22 (0.48%)
Market closed |  Prices as at close on 25 February 2021 | Switch to live prices |
Sell:$45.50
Buy:$45.52
Change: $0.22 (0.48%)
Market closed |  Prices as at close on 25 February 2021 | Switch to live prices |
Sell:$45.50
Buy:$45.52
Change: $0.22 (0.48%)
Market closed |  Prices as at close on 25 February 2021 | Switch to live prices |
The selling price currently displayed is higher than the buying price. This can occur temporarily for a variety of reasons; shortly before the market opens, after the market closes or because of extraordinary price volatility during the trading day.

HL comment (12 February 2015)

Second quarter results: The news from the internet hardware manufacturer broadly pleased investors, with both revenues and adjusted earnings materialising at the upper end of analyst forecasts. The share price rose by over 5% in after-hours US stockmarket trading. The CEO noted that "Our Q2 results reflect continued progress as we transform Cisco to become the number one IT company. In the quarter we grew revenues by 7%, with strong EPS growth, and saw the best balance of growth across all our geographies, products, and segments. We delivered this strong performance despite a volatile economic environment."

Cash flows from operations were $2.9 billion for the second quarter of fiscal 2015, compared with $2.5 billion for the first quarter of fiscal 2015. The group returned $2.2 billion to shareholders during the period. The company highlighted that its fourth annual Cisco Global Cloud survey (2013-2018) projected that over the next five years data centre traffic will nearly triple, with cloud representing 76% of total data centre traffic.

The CEO went on to note that "Our strong momentum is the direct result of how well we have managed our company transformation over the last three plus years and our leadership position in the key technology transitions of cloud, mobility, big data, security, collaboration, and the Internet of Everything. Every nation, every company, everything is becoming digitized and the network is at the centre of this transformation." For now, analyst consensus opinion currently points towards a buy.

Read more share research from Hargreaves Lansdown

Financial Highlights:
  • Total revenue rose by 7% year-over-year to $11.94 billion.
  • Adjusted Earnings Per Share (EPS) increased to 53 cents (Q2 2014: 47 cents).
  • The board declared a quarterly dividend of $0.21 per common share, a two-cent increase over the previous quarter's dividend.

Negative Points:
  • Full year 2014 revenues declined by 3% to $47.1 billion year-over-year. EPS over the full year declined by 19.9% compared to 2013.
  • The company has seen several quarters of weak sales in China, Brazil, Mexico, India and Russia. The CEO previously noted that "companies there have become more hesitant to buy Cisco products due to recent revelations about internet surveillance by the US National Security Agency."
  • Technological changes could adversely impact on Cisco's dominant high profit switching and routing business segments.
  • Cisco is exposed to competition from rivals such as Hewlett-Packard, IBM, Juniper Networks and Huawei, a Chinese technology giant that recently announced a push to sell more networking gear to US businesses.

Positive Points:
  • The results materialised at the upper end of analyst forecasts.
  • The CEO noted that "we saw the best balance of growth across all our geographies, products, and segments."
  • The company continues to pursue an acquisition-led growth strategy, diversifying its business and entering consumer markets. During the period, Cisco acquired Neohapsis to help deliver services to assist customers in building security capabilities required to remain secure and competitive in today's markets.
  • Cost reductions remain a management focus.
  • Cisco has long been seen as a sector bellwether for corporate technology spending. The Silicon Valley giant is known for its dominant position in the market for information-technology networking gear.

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This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication. Non-independent research is not subject to FCA rules prohibiting dealing ahead of research, however HL has put controls in place (including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing. Please see our full non-independent research disclosure for more information.


Data policy - All information should be used for indicative purposes only. You should independently check data before making any investment decision. HL cannot guarantee that the data is accurate or complete, and accepts no responsibility for how it may be used.

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The London Stock Exchange does not disclose whether a trade is a buy or a sell so this data is estimated based on the trade price received and the LSE-quoted mid-price at the point the trade is placed. It should only be considered an indication and not a recommendation.

Trades priced above the mid-price at the time the trade is placed are labelled as a buy; those priced below the mid-price are sells; and those priced close to the mid-price or declared late are labelled 'N/A'.