Cisco (CSCO-Q)

It's turning things around after three terrible quarters. People don't believe in this stock. They're making a push into AI and the Splunk purchase was good. But one more bad quarter, and he will sell.

He's been trimming this for underperformance and this week sold the rest of his holding. True, he liked their acquisitions and other things, but couldn't stand the price action (down) and took a loss.

Company has been around for a long time, but is evolving. Current stock price is presenting value (price too low). Strong dividend and excellent balance sheet. Recent M&A will allow for higher earnings. Expecting growth going forward. 

Security and cybersecurity are huge growth areas. $28B acquisition of Splunk, fuelling the security AI observability business. Morphed from hardware to software and services. $13B a year in free cashflow, being used to buy back stock and increase dividends. 13x PE, a really cheap tech stock. Yield is 3.4%.

Yesterday, they announced that Nvidia chose them to be their ethernet partner. Their numbers could be huge next year.

On recent report, seems to be gaining market share from its competition.

Today's theme is the expansion in the AI ecosystem infrastructure. It's so key. Networking and infrastructure, data management, security, AI tools. His 12-month price target is $53, reasonable runway. Great report recently, surprised everyone by raising guidance. Lots going on. A good one to be a core holding. Yield is 3.4%.

Good company, but legacy products that are being lapped by competition. Every quarter, management has "a reason" for poor performance. Better choices in tech.

Was upgraded today. Customers are cutting budgets short term, but a company can't have AI without investing. Cisco will come out with AI-specific products. So, focus on their long term. Short term is not great at 2% earnings growth then 6% in 2025 then 2026. Trades at 13x PE. She will hold it forever.

Building a base on the stock at current price range. Expecting stock to be a good place to hide if/when markets fall. 3-4% dividend very good for investors. Expecting high stock price going forward. 

It's a show-me story. He thinks Splunk can reignite earnings. Ex-Splunk, Cisco has been dull with tech spending going into AI. It depends on Splunk.

He likes the Splunk deal, and the stock pays a 3% dividend.

Business doesn't have A.I. tech, but management team and balance sheet are strong. Overall, a decent company. Demand for hardware still strong. 

King of networking, feeds into AI. Legacy tech still being lugged around. Beat on top and bottom, cut guidance, layoffs. Market's lowered expectations. Price target of $50, not much left.

It reports later today and he's nervous. Has bad news been priced in? Probably. The last report wasn't good and last week they announced staff cuts, which you don't do if you're in a position of strength. Trades at 12.5x forward PE and pays a 3.5% dividend as estimates have declined since the last quarter. A consistent company, but there's still room for downside.