Cisco Systems (NASDAQ:CSCO) Shares Down 2.2% – Here’s Why

Cisco Systems, Inc. (NASDAQ:CSCO) shares were down 2.2% on Friday. The company traded as low as $107.14 and last traded at $107.39. 15,856,722 shares traded hands during trading, a decline of 29% from the average daily volume of 22,282,000 shares. The stock had previously closed at $109.85.

Cisco Systems News Roundup

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

• Positive Sentiment: AI infrastructure collaboration: Cisco and NVIDIA are developing a 400G optical standard for AI data centers, designed to increase bandwidth density and support an open hardware ecosystem. The initiative could strengthen Cisco’s position in large-scale AI networking. Cisco Backs a New 400G Optical Standard for AI Data Centers
• Positive Sentiment: Strong demand and sales momentum: Cisco’s AI infrastructure spending and campus-network upgrades are supporting demand. Analysts also highlighted the company’s 17.6% year-over-year quarterly sales growth—the fastest pace in roughly a decade—as evidence of improving fundamentals. How Rare Is Cisco’s Record Sales Growth?
• Positive Sentiment: Relative valuation appeal: A comparison with Astera Labs argues that Cisco offers greater potential upside at a lower valuation while benefiting from robust networking demand, though Astera has delivered stronger recent stock performance. ALAB vs. CSCO: Which AI Infrastructure Stock Is a Better Buy?
• Neutral Sentiment: Recurring-revenue question: Investors are assessing whether Cisco can sustain software and support renewals after the current equipment-upgrade cycle slows. Recurring revenue would provide stability, but the articles do not offer new renewal data. Can Software Renewals Outlast the Networking Upgrade Cycle?
• Negative Sentiment: Competitive and headline risks: Arista Networks has outperformed Cisco in AI networking, underscoring competitive concerns. Separately, Cisco’s multimillion-dollar donation to a White House ballroom project could create reputational or political controversy, although it has no direct financial impact disclosed. Nvidia and Cisco Confirm Donations to White House Ballroom

Analyst Upgrades and Downgrades

CSCO has been the topic of several research analyst reports. KeyCorp boosted their price target on shares of Cisco Systems from $130.00 to $135.00 and gave the company an “overweight” rating in a research report on Thursday, August 13th. UBS Group raised their price objective on shares of Cisco Systems from $132.00 to $138.00 and gave the stock a “buy” rating in a report on Thursday, August 13th. Piper Sandler lowered their price objective on shares of Cisco Systems from $132.00 to $125.00 and set a “neutral” rating for the company in a report on Tuesday, September 22nd. Weiss Ratings reaffirmed a “buy (b)” rating on shares of Cisco Systems in a research report on Wednesday, August 26th. Finally, Sanford C. Bernstein assumed coverage on Cisco Systems in a report on Wednesday, September 30th. They set a “market perform” rating and a $110.00 target price on the stock. Three research analysts have rated the stock with a Strong Buy rating, sixteen have assigned a Buy rating and seven have assigned a Hold rating to the company’s stock. Based on data from MarketBeat.com, Cisco Systems presently has an average rating of “Moderate Buy” and an average target price of $128.52.

Cisco Systems Stock Performance

The company has a current ratio of 0.93, a quick ratio of 0.79 and a debt-to-equity ratio of 0.39. The company’s 50 day moving average is $111.38 and its 200-day moving average is $108.87. The company has a market capitalization of $423.39 billion, a P/E ratio of 32.15, a price-to-earnings-growth ratio of 2.24 and a beta of 0.99.

Cisco Systems (NASDAQ:CSCO) last issued its quarterly earnings results on Wednesday, August 12th. The network equipment provider reported $1.22 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.17 by $0.05. The company had revenue of $17.25 billion during the quarter, compared to analysts’ expectations of $16.84 billion. Cisco Systems had a net margin of 20.95% and a return on equity of 30.16%. Cisco Systems’s revenue was up 17.6% on a year-over-year basis. During the same period last year, the company 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. Equities analysts anticipate that Cisco Systems, Inc. will post 4.42 EPS for the current fiscal year.

Cisco Systems Dividend Announcement

The firm 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 is Friday, October 2nd. Cisco Systems’s dividend payout ratio (DPR) is presently 50.30%.

Insider Transactions at Cisco Systems

In other news, EVP Thimaya Subaiya sold 312 shares of the business’s stock in a transaction that occurred on Monday, September 14th. The stock was sold at an average price of $110.18, for a total value of $34,376.16. Following the sale, the executive vice president directly owned 127,661 shares of the company’s stock, valued at $14,065,688.98. The trade was a 0.24% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Charles Robbins sold 21,628 shares of the company’s stock in a transaction that occurred on Friday, August 14th. The stock was sold at an average price of $111.54, for a total value of $2,412,387.12. Following the completion of the sale, the chief executive officer owned 602,710 shares in the company, valued at $67,226,273.40. The trade was a 3.46% decrease in their position. 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. Over the last 90 days, insiders sold 44,869 shares of company stock worth $5,005,620. Company insiders own 0.01% of the company’s stock.

Institutional Investors Weigh In On Cisco Systems

Several hedge funds have recently added to or reduced their stakes in CSCO. BlackRock Inc. bought a new position in Cisco Systems in the 2nd quarter worth about $42,129,647,000. State Street Corp grew its position in Cisco Systems by 7.0% during the 2nd quarter. State Street Corp now owns 207,106,569 shares of the network equipment provider’s stock valued at $25,278,492,000 after purchasing an additional 13,512,872 shares during the last quarter. Bank of America Corp DE purchased a new stake in Cisco Systems during the 2nd quarter valued at about $5,892,379,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC increased its stake in Cisco Systems by 2.7% during the 2nd 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 purchasing an additional 1,143,106 shares in the last quarter. Finally, Bank of New York Mellon Corp bought a new stake in Cisco Systems during the 2nd quarter valued at about $4,714,574,000. 73.33% of the stock is owned by institutional investors.

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.