CISCO SYSTEMS INC (1CSCO.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1CSCO - US17275R1023 - Common Stock
63.25 EUR
-0.36 (-0.57%)
Taking everything into account, 1CSCO scores 6 out of 10 in our fundamental rating. 1CSCO was compared to 31 industry peers in the Communications Equipment industry. 1CSCO has an excellent profitability rating, but there are some minor concerns on its financial health. 1CSCO has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year 1CSCO was profitable.
- 1CSCO had a positive operating cash flow in the past year.
- 1CSCO had positive earnings in each of the past 5 years.
- In the past 5 years 1CSCO always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 8.53%, 1CSCO belongs to the top of the industry, outperforming 83.87% of the companies in the same industry.
- The Return On Equity of 1CSCO (22.04%) is better than 90.32% of its industry peers.
- The Return On Invested Capital of 1CSCO (12.86%) is better than 83.87% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for 1CSCO is above the industry average of 10.63%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.53% | ||
| ROE | 22.04% | ||
| ROIC | 12.86% |
ROA(3y)9.67%
ROA(5y)10.49%
ROE(3y)24.29%
ROE(5y)25.65%
ROIC(3y)14.02%
ROIC(5y)15.13%
1.3 Margins
- 1CSCO has a Profit Margin of 17.90%. This is amongst the best in the industry. 1CSCO outperforms 93.55% of its industry peers.
- 1CSCO's Profit Margin has declined in the last couple of years.
- 1CSCO has a Operating Margin of 22.52%. This is amongst the best in the industry. 1CSCO outperforms 96.77% of its industry peers.
- 1CSCO's Operating Margin has declined in the last couple of years.
- Looking at the Gross Margin, with a value of 64.85%, 1CSCO belongs to the top of the industry, outperforming 87.10% of the companies in the same industry.
- 1CSCO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.52% | ||
| PM (TTM) | 17.9% | ||
| GM | 64.85% |
OM growth 3Y-6.7%
OM growth 5Y-5.03%
PM growth 3Y-7.78%
PM growth 5Y-4.61%
GM growth 3Y1.26%
GM growth 5Y0.21%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), 1CSCO is creating some value.
- The number of shares outstanding for 1CSCO has been reduced compared to 1 year ago.
- 1CSCO has less shares outstanding than it did 5 years ago.
- The debt/assets ratio for 1CSCO has been reduced compared to a year ago.
2.2 Solvency
- The Debt to FCF ratio of 1CSCO is 2.21, which is a good value as it means it would take 1CSCO, 2.21 years of fcf income to pay off all of its debts.
- 1CSCO's Debt to FCF ratio of 2.21 is fine compared to the rest of the industry. 1CSCO outperforms 74.19% of its industry peers.
- A Debt/Equity ratio of 0.46 indicates that 1CSCO is not too dependend on debt financing.
- 1CSCO has a Debt to Equity ratio of 0.46. This is comparable to the rest of the industry: 1CSCO outperforms 48.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.21 | ||
| Altman-Z | N/A |
ROIC/WACC1.31
WACC9.81%
2.3 Liquidity
- 1CSCO has a Current Ratio of 0.93. This is a bad value and indicates that 1CSCO is not financially healthy enough and could expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 0.93, 1CSCO is doing worse than 80.65% of the companies in the same industry.
- 1CSCO has a Quick Ratio of 0.93. This is a bad value and indicates that 1CSCO is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Quick ratio of 1CSCO (0.83) is worse than 77.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
- 1CSCO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.20%, which is quite good.
- 1CSCO shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 3.50% yearly.
- Looking at the last year, 1CSCO shows a quite strong growth in Revenue. The Revenue has grown by 8.91% in the last year.
- The Revenue has been growing slightly by 2.82% on average over the past years.
EPS 1Y (TTM)10.2%
EPS 3Y4.19%
EPS 5Y3.5%
EPS Q2Q%9.89%
Revenue 1Y (TTM)8.91%
Revenue growth 3Y3.19%
Revenue growth 5Y2.82%
Sales Q2Q%7.53%
3.2 Future
- Based on estimates for the next years, 1CSCO will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.07% on average per year.
- Based on estimates for the next years, 1CSCO will show a small growth in Revenue. The Revenue will grow by 6.28% on average per year.
EPS Next Y10.59%
EPS Next 2Y9.4%
EPS Next 3Y8.67%
EPS Next 5Y10.07%
Revenue Next Year7.24%
Revenue Next 2Y6.15%
Revenue Next 3Y5.75%
Revenue Next 5Y6.28%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- 1CSCO is valuated rather expensively with a Price/Earnings ratio of 19.22.
- Based on the Price/Earnings ratio, 1CSCO is valued cheaper than 80.65% of the companies in the same industry.
- When comparing the Price/Earnings ratio of 1CSCO to the average of the S&P500 Index (27.25), we can say 1CSCO is valued slightly cheaper.
- Based on the Price/Forward Earnings ratio of 16.46, the valuation of 1CSCO can be described as correct.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of 1CSCO indicates a rather cheap valuation: 1CSCO is cheaper than 83.87% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. 1CSCO is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.22 | ||
| Fwd PE | 16.46 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as 1CSCO.
- 1CSCO's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. 1CSCO is cheaper than 67.74% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.23 | ||
| EV/EBITDA | 19.26 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1CSCO does not grow enough to justify the current Price/Earnings ratio.
- The excellent profitability rating of 1CSCO may justify a higher PE ratio.
PEG (NY)1.82
PEG (5Y)5.5
EPS Next 2Y9.4%
EPS Next 3Y8.67%
5. Dividend
5.1 Amount
- 1CSCO has a Yearly Dividend Yield of 2.18%.
- 1CSCO's Dividend Yield is a higher than the industry average which is at 2.62.
- 1CSCO's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.18% |
5.2 History
- The dividend of 1CSCO has a limited annual growth rate of 2.65%.
Dividend Growth(5Y)2.65%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 1CSCO pays out 62.56% of its income as dividend. This is not a sustainable payout ratio.
- The dividend of 1CSCO is growing, but earnings are growing more, so the dividend growth is sustainable.
DP62.56%
EPS Next 2Y9.4%
EPS Next 3Y8.67%
CISCO SYSTEMS INC / 1CSCO.MI FAQ
What is the fundamental rating for 1CSCO stock?
ChartMill assigns a fundamental rating of 6 / 10 to 1CSCO.MI.
What is the valuation status of CISCO SYSTEMS INC (1CSCO.MI) stock?
ChartMill assigns a valuation rating of 5 / 10 to CISCO SYSTEMS INC (1CSCO.MI). This can be considered as Fairly Valued.
Can you provide the profitability details for CISCO SYSTEMS INC?
CISCO SYSTEMS INC (1CSCO.MI) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for 1CSCO stock?
The Price/Earnings (PE) ratio for CISCO SYSTEMS INC (1CSCO.MI) is 19.22 and the Price/Book (PB) ratio is 6.31.
Can you provide the financial health for 1CSCO stock?
The financial health rating of CISCO SYSTEMS INC (1CSCO.MI) is 4 / 10.