Cisco has had a long history of M&A and I continue to maintain that it would serve its growth interest if it were to acquire a company such as Brocade Communications (BRCD). The company has been pretty open about the possibility of more acquisitions, but such a move is unlikely absent a showing of some strategic fundamental improvements.
As far as numbers for the quarter I expect the company to report earnings of 46 cents per share with gross margins arriving at 28%.
Though Cisco is moving in the right direction, it has an uphill battle to convince a market that rarely forgives and certainly never forgets. The company has already demonstrated that it deserves to be back in the discussion of technology companies that consistently deliver solid market beating performances.
From an investment standpoint, the stock is trading at a multiple (14) that has not factored in the company's true future potential. Investors should consider adding Cisco at current levels ahead of earnings and continue to accumulate as its recent performances suggest that the stock will be trading at $30 in a relatively short period of time.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV