Cisco (CSCO) Revenue Source Secure, Agile Networks Key To Earnings Beat

Market is expecting a “slight beat” which would be aided by Splunk. But the guidance provided for estimates for the fiscal first-quarter of 2025 are still "too aggressive,"

So I would be expecting that the sales number to be within a conservative range as Cisco already provided a soft guide of low-to-mid single digit revenue growth for FY25 and ~32% OPM.

Earnings per share is expected to come in at 85 cents per share with $13.54B in revenue for the coming quarter.

If we looked at how Cisco revenue have shifted since 2019, we are seeing that in 2023, Cisco Systems, Inc. revenue amounted to 57.00 B USD, 29.11 B USD came from its highest performing source at the moment, Secure, Agile Networks, the year earlier bringing 23.83 B USD.

So with the challenges coming from its closest competitors, Cisco has lowered its guidance, which is reasonable, as there might be some prudency in IT spending by enterprises.

But I would be looking at its End-to-End Security revenue, because I am expecting Splunk to help to push this area higher.

Based on 16 Wall Street analysts offering 12 month price targets for Cisco Systems in the last 3 months. The average price target is $55.46 with a high forecast of $70.00 and a low forecast of $48.00. The average price target represents a 22.24% change from the last price of $45.37.

If we were to look at Cisco price over the years, the current price might be on the low side, I am expecting Cisco to trade near the $50 dollars post its earnings.

Investors has suffered a 7% decline in its stock price year-to-date, but we should be seeing some low-to-mid single digit revenue growth, this should continued into FY25.

I would think that we could be seeing Cisco returns on its stock price to be in the positive by end of year.

If we looked at the technical, Cisco is still suffering from sell off as seen in MACD, so even with earnings slightly beat, that might not be enough for Cisco to provide a nice upside.

But the KDJ is showing potential of an upside move, but we need Cisco to maybe upgrade their guidance for FY25, and that could provide a better fiscal first-quarter of 2025.

I am expecting Cisco to benefit from the CrowdStrike incident, with their splunk product, this could help to provide a better sales top-line, and maybe we could see Cisco provide an update to its soft guide of low-to-mid single digit revenue growth for FY25.

Appreciate if you could share your thoughts in the comment section whether you think Cisco would be upgrading their guidance and outlook for FY25?

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.