Cisco Systems, Inc. $CSCO Stock: Pinnacle Associates Ltd. Cuts Holdings

Key Points

• Pinnacle Associates reduced its Cisco stake by 2.4% in the third quarter, selling 16,808 shares and retaining 696,388 shares valued at approximately $75 million. Institutional investors still own 73.33% of Cisco.
• Cisco’s AI networking expansion is supporting the growth outlook, with new high-capacity networking platforms, strong recent earnings, and projected revenue and EPS growth. However, analysts caution that elevated valuation and potential hardware-margin pressure could limit upside.
• The stock opened at $106.71, while analysts maintain a “Moderate Buy” consensus with an average price target of $128.52. Cisco also declared a quarterly dividend of $0.42 per share, representing a 1.6% yield.

Pinnacle Associates Ltd. trimmed its position in Cisco Systems, Inc. (NASDAQ:CSCO - Free Report) by 2.4% in the third quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The firm owned 696,388 shares of the network equipment provider's stock after selling 16,808 shares during the period. Cisco Systems makes up about 0.8% of Pinnacle Associates Ltd.'s portfolio, making the stock its 24th largest holding. Pinnacle Associates Ltd.'s holdings in Cisco Systems were worth $74,952,000 at the end of the most recent reporting period.

Other institutional investors and hedge funds have also recently added to or reduced their stakes in the company. BlackRock Inc. bought a new stake in shares of Cisco Systems in the 2nd quarter worth $42,129,647,000. State Street Corp lifted its holdings in shares of Cisco Systems by 7.0% in the second quarter. State Street Corp now owns 207,106,569 shares of the network equipment provider's stock valued at $25,278,492,000 after buying an additional 13,512,872 shares during the period. Bank of America Corp DE acquired a new stake in shares of Cisco Systems in the second quarter valued at $5,892,379,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC boosted its stake in Cisco Systems by 2.7% during the second quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 43,450,141 shares of the network equipment provider's stock valued at $5,103,654,000 after buying an additional 1,143,106 shares in the last quarter. Finally, Bank of New York Mellon Corp bought a new position in Cisco Systems during the second quarter valued at about $4,714,574,000. 73.33% of the stock is owned by institutional investors.

Trending Headlines about Cisco Systems

Here are the key news stories impacting Cisco Systems this week:

• Positive Sentiment: New AI networking platforms strengthen Cisco’s growth story. Cisco introduced 51.2-terabit and 102.4-terabit networking systems powered by its Silicon One chips, along with 1.6T optical modules and liquid-cooling technology for high-density data centers. Its collaboration with NVIDIA, TE Connectivity and Amphenol on next-generation optical connectivity could help Cisco capture more spending from the expanding AI infrastructure buildout. Cisco Systems Unveiled 102.4T AI Networking Platforms
• Positive Sentiment: AI demand is supporting an optimistic earnings setup. A preview article cited Cisco’s guidance for approximately 21% year-over-year revenue growth and 33% EPS growth, alongside recent revenue and earnings beats. Agentic AI adoption and infrastructure contracts, including international opportunities such as Bell Canada, are viewed as longer-term catalysts. Cisco Earnings Preview
• Positive Sentiment: Industry commentary supports continued AI capital spending. Strategist Tom Lee argued that the AI investment cycle may have substantial room to run, with networking, power, cooling and security among the beneficiaries. This reinforces the bullish case that Cisco’s AI order momentum could develop into a broader networking supercycle. Tom Lee on AI Stocks and Cisco
• Positive Sentiment: Splunk’s observability research highlights a potential software opportunity. Cisco reported that enterprises are struggling to monitor AI agents and control rising telemetry and AI costs. Growing demand for observability, security and operational predictability could support cross-selling through Cisco’s Splunk business. Splunk State of Observability 2026
• Neutral Sentiment: World Wide Technology’s new Cisco Secure AI Infrastructure specialization adds partner validation, but the direct near-term revenue impact is unclear. World Wide Technology Achieves Cisco Specialization
• Negative Sentiment: Valuation and margin risks remain important headwinds. One analyst downgraded Cisco to Hold after a substantial year-to-date rally, arguing that the shares are near fair value and that hardware mix could pressure gross margins. Elevated price-to-sales levels may also reduce the stock’s sensitivity to positive AI news. Cisco Valuation and Technical Support

Cisco Systems Price Performance

Shares of NASDAQ:CSCO opened at $106.71 on Wednesday. Cisco Systems, Inc. has a one year low of $69.85 and a one year high of $130.37. The stock has a fifty day moving average of $110.78 and a 200-day moving average of $109.50. The company has a market capitalization of $420.71 billion, a PE ratio of 31.95, a price-to-earnings-growth ratio of 2.22 and a beta of 0.99. The company has a debt-to-equity ratio of 0.39, a quick ratio of 0.79 and a current ratio of 0.93.

Cisco Systems (NASDAQ:CSCO - Get Free Report) last issued its earnings results on Wednesday, August 12th. The network equipment provider reported $1.22 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.17 by $0.05. The business had revenue of $17.25 billion for the quarter, compared to analysts' expectations of $16.84 billion. Cisco Systems had a return on equity of 30.16% and a net margin of 20.95%. The company's quarterly revenue was up 17.6% on a year-over-year basis. During the same period in the previous year, the firm posted $0.99 EPS. Cisco Systems has set its FY 2027 guidance at 5.050-5.110 EPS and its Q1 2027 guidance at 1.320-1.340 EPS. As a group, equities analysts anticipate that Cisco Systems, Inc. will post 4.42 EPS for the current fiscal year.

Cisco Systems Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Wednesday, October 21st. Stockholders of record on Friday, October 2nd will be issued a dividend of $0.42 per share. This represents a $1.68 annualized dividend and a dividend yield of 1.6%. The ex-dividend date of this dividend is Friday, October 2nd. Cisco Systems's dividend payout ratio is currently 50.30%.

Wall Street Analyst Weigh In

A number of research analysts recently issued reports on CSCO shares. UBS Group lifted their target price on Cisco Systems from $132.00 to $138.00 and gave the stock a "buy" rating in a report on Thursday, August 13th. Barclays upped their price target on shares of Cisco Systems from $121.00 to $123.00 and gave the company an "equal weight" rating in a report on Thursday, August 13th. Weiss Ratings restated a "buy (b)" rating on shares of Cisco Systems in a research report on Wednesday, August 26th. Wall Street Zen upgraded shares of Cisco Systems from a "hold" rating to a "buy" rating in a research report on Sunday, October 11th. Finally, HSBC cut shares of Cisco Systems from a "buy" rating to a "hold" rating and lowered their price objective for the stock from $137.00 to $120.00 in a research note on Friday, August 14th. Three equities research analysts have rated the stock with a Strong Buy rating, sixteen have issued a Buy rating and seven have issued a Hold rating to the stock. According to data from MarketBeat, the stock has an average rating of "Moderate Buy" and an average target price of $128.52.

Insiders Place Their Bets

In other Cisco Systems news, insider Jeetendra I. Patel sold 7,170 shares of the business's stock in a transaction dated Friday, August 14th. The stock was sold at an average price of $111.57, for a total transaction of $799,956.90. Following the sale, the insider owned 230,593 shares in the company, valued at approximately $25,727,261.01. The trade was a 3.02% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Thimaya K. Subaiya sold 5,832 shares of the company's stock in a transaction that occurred on Wednesday, August 19th. The shares were sold at an average price of $111.47, for a total transaction of $650,093.04. Following the completion of the sale, the executive vice president owned 128,382 shares of the company's stock, valued at approximately $14,310,741.54. This trade represents a 4.35% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 44,869 shares of company stock worth $5,005,620 over the last three months. Company insiders own 0.01% of the company's stock.

Cisco Systems Company Profile

Cisco Systems, Inc is a global technology company that develops networking, cybersecurity, collaboration and observability solutions for businesses, government organizations and service providers. Its offerings include routers, switches, wireless networking equipment, data-center infrastructure, security software and services, as well as technologies that support cloud and hybrid IT environments.

The company also provides collaboration tools through its Webex portfolio, cloud-managed networking through Cisco Meraki and security and observability capabilities that include technologies from Splunk, which Cisco acquired in 2024.

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