Cisco Systems (CSCO) Stock Higher, Acquiring Software Firm Acano for $700 Million
NEW YORK (TheStreet) -- Cisco Systems (CSCO) - Get Report stock is increasing 0.97% to $27.64 on Friday after the telecommunications equipment company this morning announced plans to acquire London-based conferencing software company Acano for $700 million in cash.
The transaction is expected to be completed in the third quarter of fiscal 2016, ending April 30.
From this deal, Cisco can benefit from Acano's hardware and software, which includes video and audio bridging company connecting video systems from numerous vendors across both cloud and hybrid environments.
"People, companies and organizations are more geographically dispersed than ever before, and collaboration is essential to helping teams increase productivity and drive growth," Cisco Corporate Development VP Rob Salvagno stated.
Based in San Jose, Cisco Systems designs, manufactures, and sells Internet Protocol (IP) based networking products and services related to the communications and information technology industry worldwide.
Separately, TheStreet Ratings team rates CISCO SYSTEMS INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
We rate CISCO SYSTEMS INC (CSCO) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and notable return on equity. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 9.1%. Since the same quarter one year prior, revenues slightly increased by 3.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- CISCO SYSTEMS INC has improved earnings per share by 37.1% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, CISCO SYSTEMS INC increased its bottom line by earning $1.73 versus $1.49 in the prior year. This year, the market expects an improvement in earnings ($2.31 versus $1.73).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 32.9% when compared to the same quarter one year prior, rising from $1,828.00 million to $2,430.00 million.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Communications Equipment industry and the overall market, CISCO SYSTEMS INC's return on equity exceeds that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: CSCO