For those who appreciate value investing, NASDAQ:CSCO is a compelling option with its solid fundamentals.

Our stock screener has spotted CISCO SYSTEMS INC (NASDAQ:CSCO) as an undervalued stock with solid fundamentals. NASDAQ:CSCO shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Valuation Insights: NASDAQ:CSCO

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NASDAQ:CSCO has earned a 7 for valuation:

• The Price/Earnings ratio is 11.88, which indicates a very decent valuation of CSCO.
• Based on the Price/Earnings ratio, CSCO is valued cheaply inside the industry as 80.36% of the companies are valued more expensively.
• CSCO is valuated cheaply when we compare the Price/Earnings ratio to 26.56, which is the current average of the S&P500 Index.
• CSCO is valuated reasonably with a Price/Forward Earnings ratio of 11.97.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of CSCO indicates a somewhat cheap valuation: CSCO is cheaper than 78.57% of the companies listed in the same industry.
• CSCO's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.62.
• 80.36% of the companies in the same industry are more expensive than CSCO, based on the Enterprise Value to EBITDA ratio.
• CSCO's Price/Free Cash Flow ratio is rather cheap when compared to the industry. CSCO is cheaper than 85.71% of the companies in the same industry.
• The excellent profitability rating of CSCO may justify a higher PE ratio.

A Closer Look at Profitability for NASDAQ:CSCO

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:CSCO, the assigned 9 is a significant indicator of profitability:

• Looking at the Return On Assets, with a value of 13.75%, CSCO belongs to the top of the industry, outperforming 92.86% of the companies in the same industry.
• Looking at the Return On Equity, with a value of 30.04%, CSCO belongs to the top of the industry, outperforming 94.64% of the companies in the same industry.
• CSCO has a Return On Invested Capital of 18.79%. This is amongst the best in the industry. CSCO outperforms 92.86% of its industry peers.
• CSCO had an Average Return On Invested Capital over the past 3 years of 16.86%. This is significantly above the industry average of 10.10%.
• The last Return On Invested Capital (18.79%) for CSCO is above the 3 year average (16.86%), which is a sign of increasing profitability.
• CSCO has a Profit Margin of 23.40%. This is amongst the best in the industry. CSCO outperforms 96.43% of its industry peers.
• CSCO's Profit Margin has improved in the last couple of years.
• The Operating Margin of CSCO (28.34%) is better than 98.21% of its industry peers.
• CSCO has a Gross Margin of 63.69%. This is amongst the best in the industry. CSCO outperforms 89.29% of its industry peers.

A Closer Look at Health for NASDAQ:CSCO

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:CSCO, the assigned 8 for health provides valuable insights:

• CSCO has an Altman-Z score of 3.56. This indicates that CSCO is financially healthy and has little risk of bankruptcy at the moment.
• CSCO has a better Altman-Z score (3.56) than 85.71% of its industry peers.
• The Debt to FCF ratio of CSCO is 0.44, which is an excellent value as it means it would take CSCO, only 0.44 years of fcf income to pay off all of its debts.
• CSCO has a Debt to FCF ratio of 0.44. This is amongst the best in the industry. CSCO outperforms 82.14% of its industry peers.
• CSCO has a Debt/Equity ratio of 0.15. This is a healthy value indicating a solid balance between debt and equity.
• CSCO does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Assessing Growth for NASDAQ:CSCO

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:CSCO has achieved a 4 out of 10:

• The Earnings Per Share has grown by an impressive 21.47% over the past year.
• CSCO shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.34% yearly.
• Looking at the last year, CSCO shows a quite strong growth in Revenue. The Revenue has grown by 10.99% in the last year.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

Our latest full fundamental report of CSCO contains the most current fundamental analsysis.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.