SuperworthCisco Systems CSCO
- Market cap
- $419.9B
- PE
- 31.9×
- 10y median 18.8×
- Forward PE
- 20.9×
- 10y median 15.3×
- Price to sales
- 6.6×
- EV/EBIT
- 28.2×
- Revenue, 12 months
- $63.3B
- +12% on a year ago
- Net margin
- 21.0%
- Free cash flow yield
- 3.0%
A Superworth story
The dot-com darling is priced like a grower again
AI data centers woke up a business that stood still for a decade. The price woke up faster, and the argument now is whether the growth lasts.
A quarter century to climb back
In March 2000, at the top of the dot-com boom, Cisco's shares peaked near 80 dollars. They spent the next quarter century below that. In the past year they finally passed it, reaching 130 dollars in June. This is not a founder's comeback. Chuck Robbins, at Cisco since 1997, has run it since 2015. It is an old leader catching a new wave: AI data centers need fast networks.
A business that stood still is growing again
For most of the last decade a year of Cisco's sales barely moved. Now it sits at a ten-year high. The new buyers are the cloud giants building AI data centers. Their orders for Cisco's AI networking gear reached 9.3 billion dollars in the year to July, far past the 5 billion Cisco itself had expected earlier in the year.
The price ran ahead of the profit
Over the past year the shares rose far faster than profit. Investors now pay about 34 times a year's reported profit, near the top of the last decade, though its closest networking peers still cost almost twice as much. That multiple uses reported profit, which runs well below Cisco's adjusted figure because it counts stock pay and the cost of past deals such as Splunk.
The cash has not kept up
Reported profit rose by almost a third in the year to July. Free cash, what is left after running and investing in the business, slipped instead, to 12.8 billion dollars, about what Cisco made ten years ago. Cisco handed nearly all of it back as dividends and buybacks, yet the buybacks only offset new shares issued as pay, and the share count did not shrink over the year.
A record quarter, and the shares fell
In August Cisco reported a record quarter, with sales up 18%, and forecast another strong year. The shares slid anyway. Memory chips cost far more, and even after Cisco raised its own prices to cover them, its adjusted gross margin fell about two points. In September Piper Sandler argued growth may be peaking and could fade back to single digits.
The price assumes the AI sales arrive
Analysts expect adjusted profit per share to grow about 18% over the next twelve months, putting the stock at about 23 times. That is high for Cisco (the line before late September is rebuilt with hindsight), yet against that growth it sits near its ten-year norm. The test comes in mid-November. If growth holds, earnings are arriving to meet the price. If it fades, the multiple has room to fall.
What has happened lately
- Cisco (SEC filing), Cisco reports fourth quarter and fiscal year 2026 earningsRecord revenue $17.3B, up 18%. Hyperscaler AI orders $9.3B for the year. Non-GAAP gross margin 66.3%, from 68.4%. $12.7B returned in dividends and buybacks. Guided FY27 revenue $72.2B to $73.4B, with $7.5B of hyperscaler AI revenue.
- CNBC, Cisco shares slide 8% despite earnings beat and stronger-than-expected guidanceShares fell 8.4% the day after the record quarter and a guidance beat, as the outlook for adjusted gross margin, 65% to 66%, came in below what analysts expected.
- CNBC, Cisco stock sinks 5% after Piper Sandler cuts price target on growth concernsPiper Sandler kept a Neutral rating and lowered the multiple it applies, on concern that networking growth is peaking and Cisco's growth could slow back to single digits.
- Cisco (SEC filing), Cisco reports third quarter earningsRevenue $15.8B, up 12%. Product orders up 35%, networking orders up more than 50%. Raised the year's expected hyperscaler AI orders to $9B from $5B, which sent the shares to a record.
Headlines link to the original source.
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Why a stock is priced where it is, one chart at a time.
Charts
Financials
| Income statement | Q1 FY24 | Q2 FY24 | Q3 FY24 | Q4 FY24 | Q1 FY25 | Q2 FY25 | Q3 FY25 | Q4 FY25 | Q1 FY26 | Q2 FY26 | Q3 FY26 | Q4 FY26 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| $14.7B+8% | $12.8B−6% | $12.7B−13% | $13.6B−10% | $13.8B−6% | $14B+9% | $14.1B+11% | $14.7B+8% | $14.9B+8% | $15.3B+10% | $15.8B+12% | $17.3B+18% | |
| Cost of revenue | $5.1B−3% | $4.6B−11% | $4.4B−17% | $4.9B−11% | $4.7B−8% | $4.9B+7% | $4.9B+10% | $5.4B+11% | $5.1B+9% | $5.4B+10% | $5.8B+18% | $6.2B+15% |
| Gross profit | $9.6B+15% | $8.2B−3% | $8.3B−10% | $8.8B−10% | $9.1B−5% | $9.1B+11% | $9.3B+12% | $9.3B+6% | $9.7B+7% | $10B+10% | $10.1B+9% | $11.1B+19% |
| R&D | $1.9B+7% | $1.9B+5% | $1.9B−1% | $2.2B+12% | $2.3B+20% | $2.3B+18% | $2.3B+20% | $2.4B+9% | $2.4B+5% | $2.4B+2% | $2.4B+2% | $2.4B+2% |
| SG&A | $3.2B+8% | $3.1B+5% | $3.3B+4% | $3.6B+10% | $3.5B+12% | $3.4B+11% | $3.5B+5% | $3.5B−2% | $3.6B+2% | $3.6B+4% | $3.5B+2% | $3.6B+3% |
| $4.3B+21% | $3.1B−6% | $2.2B−45% | $2.6B−38% | $2.4B−45% | $3.1B+1% | $3.2B+46% | $3.1B+18% | $3.4B+43% | $3.8B+22% | $4B+24% | $4.3B+38% | |
| Interest expense | $111M+11% | $120M+12% | $357M+228% | $418M+277% | $418M+277% | $404M+237% | $403M+13% | $368M−12% | $350M−16% | $370M−8% | $377M−7% | $373M+1% |
| Pre-tax income | $4.4B+28% | $3.2B−7% | $2.2B−44% | $2.4B−46% | $2.3B−49% | $2.9B−9% | $2.9B+32% | $3B+25% | $3.4B+50% | $3.6B+26% | $4B+37% | $4.9B+65% |
| $804M−0% | $527M−18% | $349M−53% | $234M−54% | −$444M | $459M−13% | $456M+31% | $449M+92% | $531M | $471M+3% | $666M+46% | $1.1B+139% | |
| Net income | $3.6B+36% | $2.6B−5% | $1.9B−41% | $2.2B−45% | $2.7B−26% | $2.4B−8% | $2.5B+32% | $2.5B+18% | $2.9B+6% | $3.2B+31% | $3.4B+35% | $3.9B+51% |
| $0.89+37% | $0.65−3% | $0.46−41% | $0.54−44% | $0.68−24% | $0.61−6% | $0.62+35% | $0.64+19% | $0.72+6% | $0.80+31% | $0.85+37% | $0.97+52% | |
| 4.1B−1% | 4.1B−1% | 4.1B−1% | 4B−1% | 4B−2% | 4B−2% | 4B−1% | 4B−1% | 4B−1% | 4B−1% | 4B−1% | 4B+0% |
Net income: 10 periods, Q4 FY12 to Q4 FY26: printed in the fourth-quarter results release.
EPS, diluted: 3 periods, Q3 FY09 to Q4 FY25: quarter's net income to common over its shares, to the cent. 10 periods, Q4 FY12 to Q4 FY26: printed in the fourth-quarter results release.
Diluted shares: 7 periods, Q4 FY09 to Q4 FY25: share-days: the 12-month average less the 9-month, weighted by days. 10 periods, Q4 FY12 to Q4 FY26: printed in the fourth-quarter results release. Q4 FY18: the earlier year to date counted no dilution: the quarter's basic count plus the later year to date's dilution.
From each company's 10-Q and 10-K filings, the newest version of each figure. Quarters are as filed (a fourth quarter is the year less its first nine months), fiscal years as the 10-K prints them, restated where a later 10-K restated them, and balance sheet lines as of the period's end. A quarter whose 10-Q isn't filed yet is from the company's results release. Growth is on the same period a year earlier. A dash is a period with no figure for the line: the filing doesn't print it, or it hasn't been read yet.
Estimates
Next earnings report: .
| Quarter | Revenue | Range | EPS | Range | Analysts |
|---|---|---|---|---|---|
| Q1 FY27 | $18.1B | $18B to $18.1B | $1.32 | $1.30 to $1.33 | 16 |
| Q2 FY27 | $17.8B | $17.7B to $18B | $1.22 | $1.19 to $1.27 | 15 |
| Q3 FY27 | $18.1B | $17.9B to $18.4B | $1.24 | $1.23 to $1.27 | 8 |
| Q4 FY27 | $18.9B | $18.7B to $19.2B | $1.31 | $1.29 to $1.34 | 8 |
| Q1 FY28 | $19.2B | $19B to $19.5B | $1.36 | $1.34 to $1.39 | 8 |
| Q2 FY28 | $19B | $18.8B to $19.3B | $1.35 | $1.33 to $1.38 | 7 |
| Q3 FY28 | $19.3B | $19.1B to $19.7B | $1.38 | $1.37 to $1.42 | 7 |
| Q4 FY28 | $20.2B | $20B to $20.6B | $1.48 | $1.47 to $1.52 | 7 |
Peers
Companies in Communication Equipment nearest Cisco Systems' size, closest first.
| Company | Market cap | PE | Its 10y median PE | Fwd PE | P/S | Revenue growth | Net margin |
|---|---|---|---|---|---|---|---|
| CSCOCisco Systems | $419.9B | 31.9× | 18.8× | 20.9× | 6.6× | +12% | 21.0% |
| MSIMotorola Solutions | $79.7B | 38.0× | 33.2× | 26.6× | 6.5× | +10% | 17.4% |
| LITELumentum | $67.8B | n/m | 40.6× | 34.8× | 22.5× | +83% | n/m |
| CIENCiena | $45.4B | 71.5× | 32.3× | 30.8× | 7.5× | +33% | 10.9% |
| Peer median | $67.8B | 54.7× | 33.2× | 30.8× | 7.5× | +33% | 14.2% |
Investors who own it
Investors we follow who held Cisco Systems at the end of Jun 30, 2026, from their 13F filings.
- Tom GaynerMarkel Group0.3% of portfolio
- Baillie GiffordBaillie Gifford0.1% of portfoliotrimmed
- Lee AinslieMaverick Capital0.0% of portfolionew
More on Cisco Systems
Each number over time
- PE ratio
- Forward PE
- Price to sales ratio
- EV/EBIT
- Price to free cash flow
- Price to book ratio
- Dividend yield
- Market cap
- Revenue
- EPS
- Free cash flow
- Profit margin
- Shares outstanding
Where it ranks
- #5of 24Communication equipment stocks with the highest profit margins
- #4of 14Communication equipment stocks with the lowest PE ratio
- #7of 18Communication equipment stocks with the lowest EV/EBIT
- #5of 11Communication equipment stocks with the fastest earnings growth
Its groups
About
- Chief executive
- Chuck Robbins, since 2015Joined 1997, CEO since 2015. Source
- Industry
- Communication Equipment
- Sector
- Technology
Valuation data, not investment advice. Prices as of .