NEW YORK (TheStreet) -- Wall Street predicts Cisco (CSCO) to post an in-line quarter when it reports earnings later Wednesday but some analysts are concerned the network equipment maker could temper expectations.
Wells Fargo Securities analyst Jess Lubert lowered estimates for the year given the "potential to see service provider weakness and emerging market challenges continue to impact results over the next few quarters."
Analysts, on average, expect earnings of 52 cents a share for Cisco's October-ended quarter. Revenue is expected to rise 1% to $12.16 billion, according to Thomson Reuters.¿
Shares were down 0.50% to $25.02 at midday on Wednesday. Here's what analysts were saying about Cisco.
Brian White, Cantor Fitzgerald (Buy; $31 PT)
Given the challenges highlighted in the U.S. service provider market by various networking vendors this earnings season, we expect Cisco to also experience this weakness. That said, we expect continued strong execution from Cisco and reasonable trends in the enterprise/commercial market. Even if Cisco's sales outlook is soft, the stock is trading at just 8.8x our CY:15 EPS estimate (ex-cash) and holds a 3% dividend yield, while we believe the profit cycle has already reached a trough.
We believe Cisco will meet or slightly miss our 1Q:FY15 revenue estimate of $12.13 billion (FactSet consensus is at $12.17 billion) and at least meet our pro forma EPS projection of $0.52 (consensus is at $0.53). For 2Q:FY15, we are projecting sales of $12.24 billion (consensus is at $12.11 billion) that we believe could prove aggressive, while we are more comfortable with our EPS estimate of $0.53 (consensus is also at $0.53) given Cisco's strong execution.