This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Cisco Grows Where Others Can't

Yet, despite what has been a difficult transition to "mature status" for Cisco, investors continue to forget that the company still owns 60% of the routing and switching business.

This is a testament to not only the quality of the company's product portfolio, but also to how loyal Cisco's customers have remained. Meanwhile the company's management has been executing as well as can be expected, reducing costs and trimming the fat from the company's less-than-favorable acquisitions.

Aside from maintaining its momentum, Cisco's current challenge is figuring out ways to fight off the competition -- from the usual suspects, such as the aforementioned F5 and HP, but also new entrants such as Palo Alto Networks (PANW - Get Report).

Palo Alto in its first earnings report as a publicly traded company produced not only year-over-year revenue growth of 90%, but grew that number by 15% over the prior quarter.

Although Palo Alto is in the early stages of its business, it is hard for even a well-established company like Cisco to ignore numbers like these. Nonetheless, Cisco still offers many market and enterprise advantages that smaller rivals can only hope to duplicate. Though Cisco may no longer be able to grow to the extent that it did in the late '90s, in many respects its "new growth spurt" has likely just begun.

But where's the love?

Bottom Line

I have no shame in admitting that I have always liked Cisco and have been one of its biggest cheerleaders. However, a sense of vindication is felt when discussing its consistent results in the face of significant market turmoil.

What's more, Cisco's strong fundamentals and particularly its cash position, which sits at close to $50 billion, offer the company more options for acquisitions to help grow profits and market dominance for the next decade.

Investors would be wise to love Cisco as current levels -- even as Wall Street continues to ignore the good.

At the time of publication, the author held no position in any of the stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Richard Saintvilus is a private investor with an information technology and engineering background and has been investing and trading for over 15 years. He employs conservative strategies in assessing equities and appraising value while minimizing downside risk. His decisions are based in part on management, growth prospects, return on equity and price-to-earnings as well as macroeconomic factors. He is an investor who seeks opportunities whether on the long or short side and believes in changing positions as information changes.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
CSCO $27.52 0.00%
PANW $146.08 0.00%
AAPL $124.43 0.00%
FB $82.22 0.00%
GOOG $548.00 0.00%


DOW 17,776.12 -200.19 -1.11%
S&P 500 2,067.89 -18.35 -0.88%
NASDAQ 4,900.8850 -46.5560 -0.94%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs