Morgan Stanley Forecasts Strong Price Appreciation for Cisco Systems (NASDAQ:CSCO) Stock

Key Points

• Morgan Stanley raised Cisco’s price target to $135 from $130 and maintained an “overweight” rating, implying approximately 9% upside. Analysts overall give the stock a “Moderate Buy” consensus with an average target of $123.38.
• Cisco exceeded quarterly expectations with $1.22 in adjusted EPS and $17.25 billion in revenue, while revenue increased 17.6% year over year. Strong AI infrastructure demand and higher fiscal 2027 guidance are key growth drivers.
• Valuation and margin pressure remain risks: Cisco trades near its 52-week high at roughly 40 times earnings, while analysts warn that lower-margin AI networking investments and squeezed gross margins could limit further gains.

Cisco Systems (NASDAQ:CSCO - Get Free Report) had its price target lifted by research analysts at Morgan Stanley from $130.00 to $135.00 in a report released on Thursday,Benzinga reports. The brokerage currently has an "overweight" rating on the network equipment provider's stock. Morgan Stanley's price objective indicates a potential upside of 8.98% from the company's current price.

Several other equities analysts also recently weighed in on the company. Citigroup lifted their target price on Cisco Systems from $90.00 to $112.00 and gave the company a "buy" rating in a research report on Thursday, May 14th. Zacks Research lowered shares of Cisco Systems from a "strong-buy" rating to a "hold" rating in a report on Tuesday, August 4th. HSBC raised shares of Cisco Systems from a "hold" rating to a "buy" rating and raised their price target for the company from $77.00 to $137.00 in a research report on Friday, May 15th. CICC Research boosted their price target on shares of Cisco Systems from $96.00 to $125.00 and gave the stock an "outperform" rating in a research note on Monday, May 18th. Finally, Barclays increased their price objective on Cisco Systems from $76.00 to $121.00 and gave the company an "equal weight" rating in a research note on Thursday, May 14th. Two research analysts have rated the stock with a Strong Buy rating, fifteen have given a Buy rating and seven have given a Hold rating to the company's stock. Based on data from MarketBeat, Cisco Systems presently has a consensus rating of "Moderate Buy" and an average price target of $123.38.

Cisco Systems Stock Performance

NASDAQ CSCO opened at $123.88 on Thursday. Cisco Systems has a fifty-two week low of $65.75 and a fifty-two week high of $130.37. The firm has a market capitalization of $488.27 billion, a P/E ratio of 40.22, a price-to-earnings-growth ratio of 2.71 and a beta of 1.02. The stock's fifty day moving average is $117.56 and its two-hundred day moving average is $98.72. The company has a debt-to-equity ratio of 0.40, a quick ratio of 0.81 and a current ratio of 0.92.

Cisco Systems (NASDAQ:CSCO - Get Free Report) last released its quarterly earnings results on Wednesday, August 12th. The network equipment provider reported $1.22 EPS for the quarter, beating the consensus estimate of $1.17 by $0.05. The firm had revenue of $17.25 billion for the quarter, compared to analyst estimates of $16.84 billion. Cisco Systems had a net margin of 20.14% and a return on equity of 28.44%. The business's revenue for the quarter was up 17.6% compared to the same quarter last year. During the same quarter in the previous year, the company earned $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. On average, research analysts anticipate that Cisco Systems will post 3.54 earnings per share for the current year.

Insider Buying and Selling at Cisco Systems

In related news, EVP Deborah L. Stahlkopf sold 6,586 shares of the stock in a transaction on Friday, May 15th. The stock was sold at an average price of $117.31, for a total value of $772,603.66. Following the transaction, the executive vice president owned 177,223 shares of the company's stock, valued at $20,790,030.13. This represents a 3.58% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Charles Robbins sold 21,400 shares of the company's stock in a transaction dated Friday, May 22nd. The stock was sold at an average price of $120.03, for a total value of $2,568,642.00. Following the transaction, the chief executive officer directly owned 637,085 shares of the company's stock, valued at approximately $76,469,312.55. This represents a 3.25% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders sold 47,650 shares of company stock worth $5,668,823. 0.01% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Cisco Systems

Hedge funds have recently modified their holdings of the business. MidAtlantic Capital Management Inc. acquired a new stake in Cisco Systems during the 4th quarter worth $25,000. Intesa Sanpaolo Wealth Management purchased a new stake in shares of Cisco Systems in the fourth quarter valued at about $25,000. Networth Advisors LLC boosted its stake in shares of Cisco Systems by 276.4% during the first quarter. Networth Advisors LLC now owns 335 shares of the network equipment provider's stock worth $26,000 after buying an additional 246 shares during the period. Financial Life Planners purchased a new position in shares of Cisco Systems during the first quarter worth about $27,000. Finally, Manning & Napier Advisors LLC raised its stake in Cisco Systems by 137.0% during the 1st quarter. Manning & Napier Advisors LLC now owns 346 shares of the network equipment provider's stock valued at $27,000 after acquiring an additional 200 shares during the last quarter. 73.33% of the stock is currently owned by hedge funds and other institutional investors.

Cisco Systems News Summary

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

• Positive Sentiment: AI-driven demand remains a major growth catalyst. Cisco reported record fourth-quarter revenue of approximately $17.3 billion, up 18% year over year, while networking product orders increased 40%. AI infrastructure orders totaled $4 billion in the quarter and $9.3 billion for fiscal 2026, with management expecting approximately $7.5 billion of AI infrastructure revenue in fiscal 2027. Cisco fiscal 2026 earnings release
• Positive Sentiment: Results and forward guidance exceeded consensus. Adjusted earnings of $1.22 per share topped the $1.17 estimate, and revenue of $17.25 billion exceeded the $16.84 billion forecast. Cisco guided for fiscal first-quarter revenue of $18.0 billion to $18.2 billion and adjusted EPS of $1.32 to $1.34, well above analysts’ expectations. Fiscal 2027 revenue guidance of $72.2 billion to $73.4 billion and adjusted EPS guidance of $5.05 to $5.11 also surpassed consensus. Reuters Cisco forecast article
• Neutral Sentiment: Quarterly dividend maintained. Cisco declared a $0.42-per-share dividend, payable October 21 to shareholders of record October 2, representing an indicated yield of approximately 1.4%.
• Negative Sentiment: Gross-margin pressure is the key concern. Analysts acknowledged the record results but said squeezed gross margins could limit the benefit of stronger sales. Investors may also be concerned that AI networking growth requires substantial investment and could carry lower margins than Cisco’s traditional business. MarketWatch margin concerns article
• Negative Sentiment: The earnings beat may not have cleared an elevated bar. With CSCO trading near its 52-week high and at roughly 40 times earnings, investors appear to be demanding accelerating growth rather than merely strong results. The pullback reflects profit-taking and skepticism that the AI-driven “supercycle” can justify the stock’s premium valuation over the longer term. Barron's Cisco AI demand article

About Cisco Systems

Cisco Systems, Inc is a global technology company that designs, manufactures and sells networking hardware, software and telecommunications equipment. Its core business focuses on enabling enterprise and service-provider networks through products such as routers, switches, network security appliances and wireless systems. Over time Cisco has broadened its portfolio to emphasize software-defined networking, cybersecurity, cloud infrastructure and edge computing solutions that help organizations build and manage modern IT environments.

In addition to hardware, Cisco offers a growing range of software platforms and subscription services for network management, security, analytics and collaboration.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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