Cisco Systems (NASDAQ:CSCO) Trading Down 1.6% on Analyst Downgrade

Cisco Systems, Inc. (NASDAQ:CSCO)’s share price traded down 1.6% on Friday after HSBC downgraded the stock from a buy rating to a hold rating. HSBC now has a $120.00 price target on the stock, down from their previous price target of $137.00. Cisco Systems traded as low as $110.06 and last traded at $111.68. 29,341,910 shares traded hands during mid-day trading, an increase of 23% from the average session volume of 23,770,551 shares. The stock had previously closed at $113.47.

Other equities research analysts have also issued research reports about the stock. Argus lifted their target price on shares of Cisco Systems from $100.00 to $150.00 and gave the company a “buy” rating in a research note on Tuesday, May 19th. Piper Sandler boosted their price objective on Cisco Systems from $86.00 to $132.00 and gave the stock a “neutral” rating in a research report on Thursday, May 14th. Morgan Stanley raised their price objective on shares of Cisco Systems from $130.00 to $135.00 and gave the stock an “overweight” rating in a research note on Thursday. UBS Group boosted their price target on Cisco Systems from $132.00 to $138.00 and gave the company a “buy” rating in a research note on Thursday. Finally, The Goldman Sachs Group boosted their price target on shares of Cisco Systems from $116.00 to $125.00 and gave the company a “neutral” rating in a report on Wednesday, June 3rd. One research analyst has rated the stock with a Strong Buy rating, fifteen have issued a Buy rating and seven have issued a Hold rating to the company’s stock. According to data from MarketBeat, the stock presently has a consensus rating of “Moderate Buy” and an average price target of $129.43.

Insider Activity at Cisco Systems

In other Cisco Systems news, EVP Thimaya K. Subaiya sold 7,127 shares of the company’s stock in a transaction on Tuesday, June 16th. The stock was sold at an average price of $119.91, for a total transaction of $854,598.57. Following the transaction, the executive vice president owned 140,857 shares of the company’s stock, valued at approximately $16,890,162.87. This represents a 4.82% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Oliver Tuszik sold 2,607 shares of the firm’s stock in a transaction dated Thursday, June 11th. The shares were sold at an average price of $121.12, for a total value of $315,759.84. Following the completion of the transaction, the executive vice president owned 172,727 shares in the company, valued at approximately $20,920,694.24. This represents a 1.49% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 31,134 shares of company stock valued at $3,739,000 over the last ninety days. 0.01% of the stock is owned by insiders.

Key Stories Impacting Cisco Systems

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

• Positive Sentiment: AI demand is accelerating. Cisco reported fiscal Q4 revenue of approximately $17.3 billion, up 18% year over year, and adjusted EPS of $1.22 versus the $1.17 consensus estimate. AI infrastructure orders increased 4.5 times to $9.3 billion for fiscal 2026, while management expects approximately $7.5 billion of hyperscaler AI infrastructure revenue in fiscal 2027. Chuck Robbins Says AI Is Fueling a Networking Supercycle
• Positive Sentiment: Fiscal 2027 guidance exceeded expectations. Management forecast roughly 15% revenue growth, supported by hyperscaler spending, data-center switching and broader networking upgrades. Several firms—including UBS, Truist, Wells Fargo, KeyCorp, Morgan Stanley and Rosenblatt—raised their price targets and maintained bullish ratings, suggesting long-term upside if the AI networking cycle continues. Cisco Just Gave Investors Three Big Reasons to Be Bullish
• Neutral Sentiment: The market is demanding faster growth. Despite the earnings beat and upbeat outlook, Cisco’s shares have decreased because expectations were already elevated after a substantial rally. Investors are questioning whether the company’s AI momentum can remain strong beyond the current infrastructure buildout and whether Cisco’s premium valuation is justified. Cisco Shares Slide Despite Earnings Beat and Strong Guidance
• Negative Sentiment: Margin pressure is the primary concern. AI infrastructure growth is arriving mainly through lower-margin hardware, creating mix-related gross-margin compression and raising questions about how profitably Cisco can scale orders. HSBC downgraded CSCO to Hold from Buy and reduced its price target to $120 from $137, citing a lack of near-term catalysts even after the strong quarter. Cisco Beat on Every Line, Then Fell on What AI Costs to Ship

Hedge Funds Weigh In On Cisco Systems

Several institutional investors have recently modified their holdings of the stock. Magnolia Capital Advisors LLC boosted its position in shares of Cisco Systems by 1.5% during the second quarter. Magnolia Capital Advisors LLC now owns 7,368 shares of the network equipment provider’s stock worth $865,000 after purchasing an additional 106 shares in the last quarter. Windsor Advisory Group LLC acquired a new position in shares of Cisco Systems during the second quarter worth about $797,000. Vantage Point Financial LLC grew its stake in shares of Cisco Systems by 6.3% during the 2nd quarter. Vantage Point Financial LLC now owns 2,829 shares of the network equipment provider’s stock worth $332,000 after acquiring an additional 167 shares in the last quarter. Pointe Capital Management LLC grew its position in Cisco Systems by 2.6% in the second quarter. Pointe Capital Management LLC now owns 13,048 shares of the network equipment provider’s stock valued at $1,533,000 after purchasing an additional 325 shares in the last quarter. Finally, Lotus Technology Management LP bought a new position in shares of Cisco Systems in the 2nd quarter valued at about $1,113,000. 73.33% of the stock is currently owned by institutional investors and hedge funds.

Cisco Systems Stock Performance

The company has a quick ratio of 0.81, a current ratio of 0.93 and a debt-to-equity ratio of 0.39. The stock has a 50 day simple moving average of $117.03 and a two-hundred day simple moving average of $99.09. The stock has a market capitalization of $440.18 billion, a P/E ratio of 33.44, a P/E/G ratio of 2.52 and a beta of 1.02.

Cisco Systems (NASDAQ:CSCO) last posted its quarterly earnings results on Wednesday, August 12th. The network equipment provider reported $1.22 earnings per share (EPS) for the quarter, topping 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 20.95% and a return on equity of 30.16%. The company’s quarterly revenue was up 17.6% compared to the same quarter last year. During the same period in the prior year, the firm posted $0.99 earnings per share. 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, equities analysts forecast that Cisco Systems, Inc. will post 4.09 EPS for the current fiscal year.

Cisco Systems Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, October 21st. Investors of record on Friday, October 2nd will be issued a dividend of $0.42 per share. The ex-dividend date of this dividend 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 presently 50.30%.

Cisco Systems Company Profile

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.