Analyst ryan youngstrand thursday october 12 2009
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Analyst: Ryan Youngstrand Thursday, October 12, 2009. Cisco Systems, Inc. (CSCO). CSCO currently (Yahoo). Stock Price $23.30 52-week range $13.61-24.83 Beta 1.21 – Reuters.com EPS (TTM) $0.98. What they do… (Yahoo). Sector: Technology Industry : Networking and Communication Devices

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Cisco Systems, Inc. (CSCO)

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Analyst ryan youngstrand thursday october 12 2009

Analyst: Ryan Youngstrand

Thursday, October 12, 2009

Cisco Systems, Inc. (CSCO)


Csco currently yahoo

CSCO currently (Yahoo)

  • Stock Price

    • $23.30

  • 52-week range

    • $13.61-24.83

  • Beta

    • 1.21 – Reuters.com

  • EPS (TTM)

    • $0.98


What they do yahoo

What they do… (Yahoo)

  • Sector: Technology

  • Industry : Networking and Communication Devices

  • “…founded in 1984 and is headquartered in San Jose, California.”

  • “…designs, manufacturers, and sells Internet Protocol (IP)-based networking and other products to the communications and IT industry worldwide.”

  • “It serves enterprise businesses, public institutions, telecommunications companies, commercial businesses, and personal residences through systems integrators, service providers, resellers, distributors, and retail partners.”

  • “…has strategic alliances with Accenture Ltd; AT&T Inc.; Cap Gemini SA.; EMC Corporation; Fujitsu Limited; Intel Corporation; Italtel SpA; Johnson Controls Inc.; Microsoft Corporation; Nokia; Nokia Siemens Networks; Oracle Corporation; SAP AG; Sprint Nextel Corporation; Tata Consultancy Services Ltd.; VMware, Inc.; and Wipro Limited.”


Swot analysis

Swot analysis

  • Strengths:

    • Diversified: Commercial, Residential, etc.

    • Worldwide

    • Service Margins Improved 400 Basis Points > Total Gross Margin 65.3%

    • High-Quality Products and Services

    • Scale Advantages

    • 70% of the $21B Switching Market > Largest Competitor, HP – 5%

    • Has a Virtual Duopoly

    • $35B Cash – $10B LT Debt

  • Weaknesses:

    • Generally Not a Need > Affected by the Economic Condition

      • Security Over Video Systems

    • General and Administrative Expenses Increased 110 Basis Points > Operating Margin 23.5% from 24.0%


Swot analysis1

Swot analysis

  • Opportunities:

    • Continued Growth > Advanced Technologies

    • Service Providers Moving Towards Single IP > CSCO’s Specialty

  • Threats

    • May be Pursuing Growth Too Fast > 12-17% LT Growth Estimate


Financial ratios reuters

Financial ratios (Reuters)


Financial ratios cont d

Financial ratios cont’d


Valuation ratios reuters

Valuation ratios (Reuters)


Trend analysis morningstar

Trend analysis (Morningstar)


Net income mil morningstar

Net income ($Mil) (Morningstar)

  • TTM > 6,134.0

  • 2009 > 6,134.0

  • 2008 > 8,052.0

  • 2007 > 7,333.0

  • 2006 > 5,580.0

  • 2005 > 5,741.0

  • 2004 > 4,401.0

  • 2003 > 3,578.0

  • 2002 > 1,893.0

  • 2001 > (1,014.0)

  • 2000 > 2,668.0


Value or growth morningstar

Value or growth (Morningstar)

  • P/E

    • TTM > CSCO 22.8IND 28.9

  • P/B

    • TTM > CSCO 3.5IND 3.3

  • P/S

    • TTM > CSCO 3.9IND 4.0


Intrinsic value morningstar

Intrinsic value (Morningstar)

  • Current Price: $23.34

  • Fair Value Estimate: $26.00

  • Consider Buying: $18.20

  • Consider Selling: $36.40

  • 2 Yr. RSI (Yahoo!): 54.87

  • Morningstar: 3 Star Rating

  • Insider Ownership Increasing > # of Sales Around $22-23 Recently

  • FCFE – $2.57 (RF > 4%; MRP > 10% = DR > 13.5%)


Csco now

CSCO now

  • In the process of incorporating four acquisitions started this quarter.

  • Enters new markets through acquisitions.


Cisco systems inc csco

2-YEAR STOCK CHART (Yahoo!)


Cisco systems inc csco

COMPARISON WITH COMPETITORS

AND S&P 500


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