Tag Archives: CSCO

Cisco: Strong Transition Growth Supported By Record Revenue [Seeking Alpha]

Cisco Systems, Inc. (CSCO) is the world’s leading supplier of data networking equipment and software. CSCO closed at $20.99 with a 0.71% loss on February 14, 2013 despite better-than-expected Q2 earnings.

Q2, 2013 Earnings

On February 13, 2013, CSCO reported Q2, 2013 earnings of 47 cents per share, beating Zacks Consensus Estimate of 43 cents per share on higher revenue and lower-than-expected operating expenses. Revenues increased 5.2% year-over-year to $12.1B, where products (78% of total revenue) were up 3.3% year-over-year to $9.4B and services (22% of total revenue) increased 12.5% year-over-year to $2.7B. Below are Q2 revenue growth and Q2 product orders breakdown, as well as Q2 revenue breakdown by product category.

Q2 Revenue Growth and Product Orders

Americas region Asia-Pacific, Japan and China (APJC) Europe, Middle East and Africa (EMEA)
Revenue Growth (vs. Year-ago quarter) +9% +8% -5%
Product Orders +2% +3% -6%

Q2 Revenue Breakdown by Product Category

% of Revenue Change (Year-over-Year)
NGN Routing 16.1% -6.0%
Collaboration 7.8% -11.0%
Other Product 1.6% -29.0%
Switching 30.8% 3.0%
Service Provider Video 10.0% 20.0%
Data Center 4.5% 65.0%
Wireless 4.3% 27.0%
Security 2.8% 1.0%
Service 22% 10.0%

Gross Margins

Gross margin decreased by 80 basis points to 60.7% as compared to the year-ago quarter due to an unfavorable product mix. The net operating margin also decreased 70 bps to 23.0%. Research and development and general and administrative costs were both up while sales and marketing expenses declined.

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Investors Can Sleep Well With These 3 Large-Cap Technology Stocks [Seeking Alpha]

Investors who are looking for technology stocks that offer strong cash flow, healthy balance sheet, and profitable margins with solid competitive edges can consider the following three companies: Oracle Corporation (ORCL), Cisco Systems, Inc. (CSCO) and Cognizant Technology Solutions Corp (CTSH).

Oracle Corporation

Oracle Corporation is a provider of enterprise software and computer hardware products and services, including databases, middleware and applications. Software license and product support is the most profitable segment of ORCL’s operation. ORCL closed at $34.56 with 1.54% loss on February 7, 2013. ORCL had been trading in the range of $25.3-$36.31 in the past 52 weeks. ORCL has a beta of 1.10.

In early February, ORCL announced the acquisition of Acme Packet Inc. (APKT) for $1.7B net of cash while the company is expanding into the networking equipment market long dominated by Cisco Systems Inc. Analysts believe Acme Packet is a good for ORCL because it expands existing ties with telecommunications providers, many of whom are already heavily dependent on Oracle’s business management software and database for running their internal operations, as reported by Reuters.

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3 Large-Cap Stocks With Revenue Growth And Strong Free Cash Flow [Seeking Alpha]

The markets have been in a rally mode since the beginning of 2013. The S&P 500 closed above 1,500 for the first time in more than five years on January 25, 2013, as strong earnings continued to boost the index. Investors’ sentiment is very bullish, and the market is driven by extreme greed. Nonetheless, intelligent investors know that too much optimism may not be a good thing, as quoted from Warren Buffett, “Be fearful when everyone is greedy. Be greedy when everyone is fearful.” The central theme of this article is not to predict the market direction, but to review a list of high quality large-cap stocks that generate strong free cash flow while continuing to grow its revenue. So, when the tide turns, investors can still count on steady cash flows from these stocks with solid fundamentals.

Company Name (Ticker) Revenue, ttm Quarterly
Revenue Growth, ttm (yoy)
Levered Free Cash Flow, ttm Diluted
EPS
Forward Annual
Dividend Yield
Cisco Systems, Inc. (CSCO) $46.68B 5.50% $9.27B $1.55 2.60%
China Mobile Ltd. (CHL) $86.83B 6.60% $5.26B $4.97 3.50%
The Coca-Cola Company (KO) $47.60B 0.80% $6.42B $1.91 2.80%

Source: Yahoo Finance

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Top Bullish Stocks On Monday: Cisco, HP And Arena Pharmaceuticals With Unusual Call Activities [Seeking Alpha]

The stock market closed mixed again on Monday. Apple (AAPL) dropped 3.57% on reports that production of the iPhone was cut on weak demand. Sprint Nextel (S) declined 3.89% as Sprint was downgraded by J. P. Morgan Securities and UBS to neutral. Dow Jones was the only major index closed in green with 0.14% increase. Nasdaq led the loss with 0.26%, and S&P 500 closed with 0.09% drop. DIA, QQQ and SPY still closed well above their 50-day and 200-day MAs. The technology sector led the loss with 0.40% decline, and the transportation led all sectors with 0.56% advance.

The market sentiment is driven by extreme greed now with Fear & Greed Index at 86, which had increased from the previous closing of 85. As reported by CBOE, the total put/call ratio for today was 0.81, and the index put/call ratio was 0.97. The equity put/call ratio was 0.52, and the CBOE volatility index (VIX) put/call ratio was 0.46. In the following, top stocks had been identified through our daily options scanning process, with the scanning criteria where the daily call volume ratio was above 2.00 (2x of the average call volume) with a call volume above 20,000.

Name (Ticker) Call Volume Average Call Volume Daily Volume Ratio
Cisco Systems, Inc. (CSCO) 92,420 39,334 2.35
Arena Pharmaceuticals, Inc. (ARNA) 22,907 9,341 2.45
Hewlett-Packard Company (HPQ) 103,773 28,036 3.70

Source: Schaeffer’s Research

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Cisco Continues To Adapt And Grow And Is Still Undervalued [Seeking Alpha]

Cisco Systems, Inc. (CSCO) is the world’s leading supplier of data networking equipment and software. CSCO provides a line of products for transporting data, voice, and video around the world, including routers, switches, access equipment, and network management software. The Company is expected to expand its operating margin continuously with its substantial scale advantage, meaningful customer switch costs, and a reputation as a go-to provider of enterprise-class networking equipment. As Internet traffic grows, 50% or more per year with most estimates, demand for Cisco’s networking gear will grow.

Recent Acquisitions

On Nov. 29, 2012, CSCO acquired software maker Cariden Technologies Inc. for $141 million as part of the effort to provide more tools for managing the increasing online traffic from mobile devices. Cariden Technologies is a privately held company and states it has been consistently profitable as its revenue has grown by a compounded annual rate of about 50 percent during past 5 years, which coincided with the rising use of smartphones and tablet computers to access online services.

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