Tag Archives: csco

Cisco Jumps On Earnings, Outlook; Analysts Hail ‘Strong Execution’

Cisco Systems ( CSCO ) received several price-target hikes after its fiscal Q3 earnings late Wednesday beat on both the top and bottom lines, as did its earnings and revenue guidance. For its fiscal third quarter , Cisco said revenue rose 3% from the year-earlier period, to $12 billion, just beating the consensus estimate of $11.97 billion, as polled by Thomson Reuters. Cisco said earnings per share minus items rose 5.6% to 57 cents, edging the consensus of 55 cents. Cisco stock rose 4% in morning trade on the stock market today , near 28. FBN Securities analyst Shebly Seyrafi maintained an outperform rating on Cisco and raised his price target to 32 form 30. “We believe that management tone was more upbeat this time than three months ago,” he wrote in a research note. Drexel Hamilton analyst Brian White raised his price target to 36 from 34 and maintained his buy rating on Cisco stock. “Cisco’s strong execution in fiscal Q3 overpowered a challenging demand environment with upside in the quarter and a stronger than expected Q4 outlook,” White wrote in a research note. “Overall, we are very pleased with Cisco’s Q4 outlook, given the economic backdrop and soft IT spending environment.” RBC Capital Markets analyst Mitch Steves, who maintained an outperform rating, raised his price target to 33 from 31. “While we remain cautious on the legacy portfolio given the overall IT spending environment, we think Cisco is continuing to move in the right direction highlighted by solid margin performance and improving business mix,” he wrote. Pacific Crest Securities analyst Brent Bracelin maintained an overweight rating and a price target of 30. “We continue to be impressed by strong execution under the new leadership team,” Bracelin wrote. “Cisco continues to execute a multiyear shift to a software-centric, subscription-driven business model.” Analysts had lowered expectations ahead of Cisco earnings due to the growing number of companies outsourcing computing workloads to cloud computing service providers such as Amazon.com ( AMZN ) and its Amazon Web Services business. The move to cloud computing has lowered demand for Cisco’s networking gear. The lowered expectations also reflected trends toward lower spending on information technology overall. Well aware of the trends, Cisco is diversifying beyond its core switch and router business into newer, higher-growth segments such as software, data centers, security, wireless and the Internet of Things market.

Cisco Earnings, Guidance Beat Wall Street Estimates, Stock Up Late

Cisco Systems ( CSCO ) reported fiscal third-quarter earnings after the market close Wednesday that beat on both the top and bottom lines, and did its earnings guidance. Revenue rose 3% from the year-earlier period, to $12 billion, just beating the consensus estimate of $11.97 billion, as polled by Thomson Reuters. For the quarter ended April 30, Cisco said earnings per share minus items rose 5.6% to 57 cents, edging the consensus of 55 cents. The No. 1 maker of switches and other networking gear projected Q4 EPS ex items of 59 cents to 61 cents, vs. 59 cents in the year-ago quarter and topping consensus of 58 cents. Cisco stock was up 5% in after-hours trading, after the earnings release. Cisco stock rose a fraction in Wednesday’s regular session, to 26.72, which is up 19% from the two-year low of 22.46 touched on Feb. 10. “We delivered a strong Q3, executing well despite the challenging environment,” Cisco CEO Chuck Robbins said in the earnings release. Analysts had lowered expectations ahead of Cisco earnings due to the growing number of companies outsourcing computing workloads to cloud computing service providers such as Amazon.com ( AMZN ) and its Amazon Web Services business. The move to cloud computing has lowered demand for Cisco’s networking gear. The lowered expectations also reflected lower spending on information technology overall. Well aware of the trends, Cisco is diversifying beyond its core switch and router business into newer, higher-growth segments such as software, data centers, security, wireless and the Internet of Things market.

F5 Networks A Buyer, Not Seller? Security Acquisition May Be Plan

F5 Networks ( FFIV ) could be a buyer, not a seller, and might use its sizable cash-on-hand to acquire a data center security  provider, says Pacific Crest Securities. Some analysts have speculated F5 Networks itself could be sold, amid its  slowing revenue growth . F5 Network stock has clawed back 7% in 2016 after falling 25% in 2015. But F5 Networks stock was down 1.5%, near 106, in early trading in the stock market today . Brent Bracelin, an analyst at Pacific Crest,  downgraded F5 Networks stock on Tuesday to sector weight. “Going forward, we see an increasing probability that M&A will have a greater role in defining (F5 Network’s) ‘third act,’ particularly given that F5 has excess cash reserves of $1 billion and robust operating cash flows that exceed $600 million annually,” he wrote in a research report. Seattle-based F5 is the leading maker of application delivery controllers (ADCs) — electronic boxes that direct data traffic to computer servers. ADCs optimize server workloads in corporate and telecom data centers, helping speed up websites and communication networks. F5 Networks has made some small security-related acquisitions , including Defense.Net, a provider of cloud-based security services that help protect websites from large-scale distributed denial of service (DDoS) attacks, as well as Israel-based Versafe, a maker of software that protects Web applications from malware, fraud and phishing attacks. F5 Network’s closest rival in application-based data center security is Imperva ( IMPV ), analysts say. The so-called perimeter firewall market — the main type of firewall — is a crowded field, with  Check Point Software Technologies ( CHKP ),  Cisco Systems ( CSCO ) and Palo Alto Networks ( PANW ) among the vendors. Another concern is that F5’s revenue growth might not rebound in 2016, Bracelin said. “The Shasta appliance refresh cycle will not drive a return to double-digit product growth, at least not for any quarter this year, and that there is increasing execution risk with a higher probability of M&A within cloud security,” he added. F5 competes with  Citrix Systems ( CTXS ), as well as  Radware ( RDWR ) and  A10 Networks ( ATEN ).