Cisco Systems (NASDAQ:CSCO) Stock Falls 3.3% - Should You Sell?

Key Points

• Cisco shares fell 3.3% to $109.85, with trading volume below its daily average. Despite the decline, analysts maintain a “Moderate Buy” consensus and an average price target of $128.52.
• Cisco recently exceeded quarterly earnings and revenue expectations, reporting $1.22 in EPS and $17.25 billion in revenue, with revenue up 17.6% year over year.
• The company declared a quarterly dividend of $0.42 per share, equivalent to an annualized $1.68 payout and a 1.5% yield; insiders have sold shares under pre-arranged trading plans.

Cisco Systems, Inc. (NASDAQ:CSCO - Get Free Report) shares traded down 3.3% during trading on Thursday. The stock traded as low as $108.45 and last traded at $109.85. 20,827,670 shares were traded during mid-day trading, a decline of 7% from the average daily volume of 22,313,926 shares. The stock had previously closed at $113.64.

Analyst Ratings Changes

CSCO has been the subject of a number of recent analyst reports. Wall Street Zen raised Cisco Systems from a "hold" rating to a "buy" rating in a research report on Sunday. HSBC cut shares of Cisco Systems from a "buy" rating to a "hold" rating and cut their price target for the company from $137.00 to $120.00 in a report on Friday, August 14th. Weiss Ratings reaffirmed a "buy (b)" rating on shares of Cisco Systems in a research note on Wednesday, August 26th. KeyCorp lifted their target price on shares of Cisco Systems from $130.00 to $135.00 and gave the company an "overweight" rating in a report on Thursday, August 13th. Finally, Rosenblatt Securities upped their price target on Cisco Systems from $150.00 to $165.00 and gave the stock a "buy" rating in a research note on Thursday, August 13th. Three analysts have rated the stock with a Strong Buy rating, sixteen have issued a Buy rating and seven have assigned a Hold rating to the company. According to MarketBeat.com, the company presently has an average rating of "Moderate Buy" and a consensus price target of $128.52.

Cisco Systems Price Performance

The firm has a 50-day moving average of $111.88 and a 200-day moving average of $108.67. The company has a debt-to-equity ratio of 0.39, a quick ratio of 0.79 and a current ratio of 0.93. The firm has a market capitalization of $433.09 billion, a P/E ratio of 32.89, a PEG ratio of 2.40 and a beta of 0.99.

Cisco Systems (NASDAQ:CSCO - Get Free Report) last posted its earnings results on Wednesday, August 12th. The network equipment provider reported $1.22 EPS for the quarter, topping analysts' consensus estimates of $1.17 by $0.05. Cisco Systems had a return on equity of 30.16% and a net margin of 20.95%. The business had revenue of $17.25 billion during the quarter, compared to analyst estimates of $16.84 billion. During the same quarter last year, the company earned $0.99 EPS. The company's quarterly revenue was up 17.6% compared to the same quarter last year. 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, analysts predict that Cisco Systems, Inc. will post 4.42 EPS for the current year.

Cisco Systems Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Wednesday, October 21st. Stockholders of record on Friday, October 2nd will be paid a $0.42 dividend. The ex-dividend date is Friday, October 2nd. This represents a $1.68 dividend on an annualized basis and a dividend yield of 1.5%. Cisco Systems's payout ratio is currently 50.30%.

Insider Activity

In other news, EVP Deborah L. Stahlkopf sold 6,487 shares of the stock in a transaction on Friday, August 14th. The stock was sold at an average price of $111.53, for a total transaction of $723,495.11. Following the transaction, the executive vice president directly owned 167,116 shares of the company's stock, valued at $18,638,447.48. This represents a 3.74% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Jeetendra I. Patel sold 7,170 shares of the firm's stock in a transaction on Friday, August 14th. The stock was sold at an average price of $111.57, for a total value of $799,956.90. Following the completion of the transaction, the insider owned 230,593 shares in the company, valued at approximately $25,727,261.01. This trade represents a 3.02% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 44,869 shares of company stock valued at $5,005,620 over the last three months. Corporate insiders own 0.01% of the company's stock.

Institutional Inflows and Outflows

A number of institutional investors have recently bought and sold shares of the company. BlackRock Inc. purchased a new position in Cisco Systems during the 2nd quarter valued at about $42,129,647,000. Auto Owners Insurance Co raised its holdings in shares of Cisco Systems by 8,718.3% in the 4th quarter. Auto Owners Insurance Co now owns 51,952,421 shares of the network equipment provider's stock valued at $400,190,000 after purchasing an additional 51,363,281 shares in the last quarter. Bank of America Corp DE bought a new stake in shares of Cisco Systems in the 2nd quarter valued at about $5,892,379,000. Bank of New York Mellon Corp purchased a new stake in shares of Cisco Systems in the 2nd quarter worth approximately $4,714,574,000. Finally, Deutsche Bank AG purchased a new stake in Cisco Systems during the second quarter worth $1,997,004,000. Institutional investors own 73.33% of the company's stock.

Cisco Systems Company Profile

Cisco Systems, Inc is a global technology company that develops networking, cybersecurity, collaboration, observability and data center solutions. Its products and services help businesses, governments, educational institutions and other organizations connect users and devices, manage infrastructure, protect digital environments and support cloud-based operations.

Cisco's portfolio includes routers and switches, wireless networking equipment, network management software, firewalls, identity and access tools, endpoint security products, collaboration applications and observability platforms.

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