This Day On The Street
Continue to site
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

A Chart You Should See: Cisco's Rise and Fall

CSCO Chart CSCO data by YCharts

NEW YORK (TheStreet) -- After a tough few weeks for Cisco (CSCO - Get Report) stock, the tech bellwether will be keen to convince investors that it can handle spending and competitive pressures at its financial analyst conference on Thursday.

After enjoying a summertime rally, the tech giant's shares have plunged 12% since it reported its fiscal first-quarter results last month. Weighed down by weak tech spending Cisco missed Wall Street's revenue forecast, sending the firm's shares plummeting. Speaking during Cisco's earnings conference call, CEO John Chambers highlighted the "inconsistent" macro environment. More specifically, Chambers pointed to the impact of the federal government shutdown and the fallout from the NSA snooping controversy in China.

In contrast, shares of rival Brocade (BRCD) have climbed more than 4% since it reported its own fiscal fourth-quarter results last month. Despite the tough spending climate, Brocade's numbers came in better than expected and investors appear to be acknowledging the firm's fiscal 2015 growth plan.

Must Read: Why Your iPhone May Be About to Get A Whole Lot More Expensive

Overall, Cisco's shares have gained just 6.26% this year, while Brocade shares have climbed 58.16%.

On Wednesday, before market open, Citi Research initiated coverage of Cisco with a "sell" rating and an $18 price target. "We forecast revenue grows at a slower 3-5% pace over the next 3 years than both Cisco's existing 5-7% long-term growth target and the Street at 6%, from share loss in Cisco's core routing and switching markets," wrote Citi analyst Ehud Gelblum, in a note. "We expect this slowing revenue growth and uncertainty around Cisco's position in the data center to result in multiple compression despite an attractive 4% dividend and 9% free cash flow."

Last month, following Cisco's earnings, CFO Frank Calderoni acknowledged the spending challenges that the company is facing, particularly in the service provider space and emerging markets.

Nonetheless, the CFO struck a bullish long-term tone. "We have been emphasizing investments in security, emphasis in cloud, emphasis in data center, emphasis in services - we're continuing down that path," he told TheStreet. "From our long-range business and financial model, we're confident in our ability to execute on that over a long period of time."

CEO John Chambers kicks off Cisco's financial conference at 8 A.M. EST on Thursday, followed by Rob Lloyd, the company's president of development and sales, and Calderoni.

Cisco shares closed down 1.56% to $20.88 in Wednesday trading.

--Written by James Rogers in New York.

>Contact by Email.

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
Only $9.95
14-Days Free
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
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
CSCO $25.11 1.74%
AAPL $93.99 0.31%
FB $102.01 0.10%
GOOG $682.40 -0.10%
TSLA $151.04 0.38%


Chart of I:DJI
DOW 15,973.84 +313.66 2.00%
S&P 500 1,864.78 +35.70 1.95%
NASDAQ 4,337.5120 +70.6750 1.66%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs