In This Article:
Cisco (CSCO) stock is advancing 1% after the tech giant reported better-than-expected fiscal second-quarter results, raised its full-year revenue guidance, and was praised by a number of banks.
A Look at CSCO's Q4 Results and Guidance
The company's revenue surged 9.4% last quarter versus the same period a year earlier to $14 billion, $120 million above analysts' average estimate. Its earnings per share, excluding certain items, rose 8% year-over-year to 94 cents, compared with analysts' average estimate of 91 cents. And impressively, its product orders jumped 29% YOY and increased 11% YOY excluding the impact of its acquisition of Splunk which closed in March 2024.
Engineers using the latest Cisco TelePresence technology to collaborate with colleagues around the world.
On the guidance front, CSCO now expects its top line for its full fiscal year to come in at $56 billion to $56.5 billion, versus its previous outlook of $55.3 billion to $56.3 billion. Additionally, the firm raised its full-year adjusted EPS outlook to $3.68 to $3.74 from $3.60 to $3.66. Analysts on average were calling for adjusted EPS of $3.66 and sales of $56 billion.
Multiple Banks Were Impressed by Cisco's Performance and Outlook
Citi wrote that the double-digit percentage growth of the firm's campus and data center switching businesses "bodes well" for the outlook of its networking business in upcoming quarters. The bank also viewed favorably the fact that CSCO had received $750 million of "cloud AI orders" in the first two quarters of its fiscal year. Investment bank Evercore ISIS, meanwhile, called the results "impressive" and thinks the company's raised full-year guidance is "relatively conservative."
While we acknowledge the potential of CSCO, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CSCO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ ALSO 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock
Disclosure: None. This article is originally published at Insider Monkey.