Opinions David Driscoll
CiscoCSCOCOMMENTOct 04, 2017
David DriscollStock price when the opinion was issued
As of Sep 04, 2026. Market Open.
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Has owned this since 2015 and has outperformed the market at a low beta. It was priced for perfection, so shares fell after they reported. But their topline is growing, the valuation is terrific and they're in the AI space.
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Premium contentIt recorded record quarterly revenue of $17.25 billion (an 18% year-over-year increase), compared to the $16.82 billion projected by Wall Street analysts. It reported adjusted earnings per share (EPS) of $1.22, surpassing the consensus estimate of $1.17. Management raised its fiscal year 2027 forecasts to a range of $72.2 billion to $73.4 billion, well above market expectations. Social media mentions are up 3,575% in the past 24h.
It reports after the bell. A value name for its cash flow and consistent earnings. They've been talking about their plans, so it has a lot of momentum behind up, up 59% this year.
Brian BelskiIs up 93% this year. Optical is critical to AI infrastructure, like copper once was. The FCC is considering limiting Chinese imports of optical, which means more demand for American names like CSCO.
Joe TerranovaPremium contentA much needed refresh in network technology and security is the reason behind analysts expectations of continued positive growth for CSCO in the next few fiscal years. The company is prudently using some cash reserves to aggressively buy back shares - albeit with slightly more debt. It trades at 36x earnings, 9x book and with a 25% ROE -- demonstrating its ability to defend its value in the market place. We recommend setting a stop-loss at $170, looking to achieve $133 -- upside potential near 18%. Yield 1.4%
(Analysts’ price target is $132.40)
Like Apple it was sort of a sleeper last year. It sells processes and analogue chips, very different than GPU's. Is involved in networking products and services. The AI stack explosion needed their products and technology. It is fully priced according to analysts' price targets.
Kim BoltonKudos on that choice, because it's not been a market darling (since the dot-com bubble). Riding coattails of stronger players in the space, catching the halo effect. The old adage: "No one ever went broke taking a profit" -- good risk management.
Prefers, and owns, ANET.
Premium contentIn the last quarter, the company reported 1.06 USD per share, beating the 1.03 USD estimate by 2.42%. Revenue for the same period reached 15.84 B USD, despite the estimate of 15.56 B USD. For the next quarter, analysts expect 1.12 USD in earnings per share and 16.36 B USD in revenue. Social media mentions are up 3,017% in the past 24h.
It reports today. This should benefit from whatever tech comes out. Is up 40% the past year, and expectations are high, expected to generate $15 billion or 8-9% growth over last year. She thinks they will come in line, but should not be punished. Is worried over these high expectations.
Part of IT infrastructure, but $27B acquisition of Splunk really helped drive security business. Finally hit a new high (previous high was March 27, 2000). Phenomenal allocator of capital. Compelling buy. Every year, buys back stock and raises dividend.
Finally growing revenues again, he's looking for mid-high single-digit revenue growth. AI will bring a much higher recurring revenue stream. Its solutions are so embedded in businesses, he's not worried about clients trying to go it alone with AI.
Lorne Steinberg
Trying to make the move from hardware to software. It has decent free cash flow, but is not growing fast enough, so would never make his list of “wanting to own”. They are going to struggle because there are bigger operators in that space. Instead of expecting huge growth and a huge multiple, his guess is that is it going to be more like a commoditized growth rate in the 5%-10% range, if that. If anybody overtakes them, they’re going to have to struggle to keep pace.