77.55 USD
-0.7 (-0.89%)
77.39 USD
-0.16 (-0.21%)
We assign a fundamental rating of 5 out of 10 to CSCO. CSCO was compared to 48 industry peers in the Communications Equipment industry. CSCO has an excellent profitability rating, but there are some minor concerns on its financial health. CSCO has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year CSCO was profitable.
In the past year CSCO had a positive cash flow from operations.
CSCO had positive earnings in each of the past 5 years.
In the past 5 years CSCO always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.53%, CSCO belongs to the top of the industry, outperforming 83.33% of the companies in the same industry.
CSCO has a Return On Equity of 22.04%. This is amongst the best in the industry. CSCO outperforms 87.50% of its industry peers.
CSCO has a Return On Invested Capital of 12.86%. This is amongst the best in the industry. CSCO outperforms 85.42% of its industry peers.
CSCO had an Average Return On Invested Capital over the past 3 years of 14.02%. This is in line with the industry average of 12.35%.
| 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
CSCO's Profit Margin of 17.90% is amongst the best of the industry. CSCO outperforms 91.67% of its industry peers.
CSCO's Profit Margin has declined in the last couple of years.
CSCO has a better Operating Margin (22.52%) than 91.67% of its industry peers.
CSCO's Operating Margin has declined in the last couple of years.
CSCO's Gross Margin of 64.85% is amongst the best of the industry. CSCO outperforms 87.50% of its industry peers.
CSCO'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), CSCO is creating some value.
The number of shares outstanding for CSCO has been reduced compared to 1 year ago.
The number of shares outstanding for CSCO has been reduced compared to 5 years ago.
Compared to 1 year ago, CSCO has an improved debt to assets ratio.
2.2 Solvency
The Debt to FCF ratio of CSCO is 2.21, which is a good value as it means it would take CSCO, 2.21 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.21, CSCO is doing good in the industry, outperforming 60.42% of the companies in the same industry.
A Debt/Equity ratio of 0.46 indicates that CSCO is not too dependend on debt financing.
CSCO's Debt to Equity ratio of 0.46 is on the low side compared to the rest of the industry. CSCO is outperformed by 72.92% of its industry peers.
Although CSCO does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.21 | ||
| Altman-Z | N/A |
ROIC/WACC1.38
WACC9.3%
2.3 Liquidity
A Current Ratio of 0.93 indicates that CSCO may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.93, CSCO is doing worse than 91.67% of the companies in the same industry.
CSCO has a Quick Ratio of 0.93. This is a bad value and indicates that CSCO is not financially healthy enough and could expect problems in meeting its short term obligations.
CSCO has a worse Quick ratio (0.83) than 87.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 10.20% over the past year.
CSCO shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 3.50% yearly.
The Revenue has grown by 8.91% in the past year. This is quite good.
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
CSCO is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.07% yearly.
The Revenue is expected to grow by 6.28% on average over the next years.
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
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.94, the valuation of CSCO can be described as rather expensive.
Based on the Price/Earnings ratio, CSCO is valued a bit cheaper than the industry average as 70.83% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 26.43, CSCO is valued a bit cheaper.
With a Price/Forward Earnings ratio of 17.05, CSCO is valued on the expensive side.
CSCO's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CSCO is cheaper than 72.92% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CSCO to the average of the S&P500 Index (23.66), we can say CSCO is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.94 | ||
| Fwd PE | 17.05 |
4.2 Price Multiples
62.50% of the companies in the same industry are more expensive than CSCO, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, CSCO is valued a bit cheaper than the industry average as 60.42% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.06 | ||
| EV/EBITDA | 20.11 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CSCO does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of CSCO may justify a higher PE ratio.
PEG (NY)1.88
PEG (5Y)5.7
EPS Next 2Y9.4%
EPS Next 3Y8.67%
5. Dividend
5.1 Amount
CSCO has a Yearly Dividend Yield of 2.07%. Purely for dividend investing, there may be better candidates out there.
CSCO's Dividend Yield is rather good when compared to the industry average which is at 0.75. CSCO pays more dividend than 85.42% of the companies in the same industry.
CSCO's Dividend Yield is comparable with the S&P500 average which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.07% |
5.2 History
The dividend of CSCO has a limited annual growth rate of 2.65%.
CSCO has paid a dividend for at least 10 years, which is a reliable track record.
CSCO has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)2.65%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
CSCO pays out 62.56% of its income as dividend. This is not a sustainable payout ratio.
CSCO's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP62.56%
EPS Next 2Y9.4%
EPS Next 3Y8.67%
77.55
-0.7 (-0.89%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners81.22%
Inst Owner Change-0.31%
Ins Owners0.03%
Ins Owner Change1.05%
Market Cap306.41B
Revenue(TTM)57.70B
Net Income(TTM)10.33B
Analysts77.42
Price Target86.2 (11.15%)
Short Float %1.3%
Short Ratio2.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.07% |
Yearly Dividend1.62
Dividend Growth(5Y)2.65%
DP62.56%
Div Incr Years13
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.32%
Min EPS beat(2)-0.5%
Max EPS beat(2)-0.13%
EPS beat(4)2
Avg EPS beat(4)0.81%
Min EPS beat(4)-0.5%
Max EPS beat(4)2.52%
EPS beat(8)6
Avg EPS beat(8)1.6%
EPS beat(12)10
Avg EPS beat(12)2.14%
EPS beat(16)12
Avg EPS beat(16)1.69%
Revenue beat(2)0
Avg Revenue beat(2)-1.39%
Min Revenue beat(2)-1.58%
Max Revenue beat(2)-1.19%
Revenue beat(4)0
Avg Revenue beat(4)-1.35%
Min Revenue beat(4)-1.58%
Max Revenue beat(4)-1.14%
Revenue beat(8)0
Avg Revenue beat(8)-1.25%
Revenue beat(12)0
Avg Revenue beat(12)-1.18%
Revenue beat(16)2
Avg Revenue beat(16)-1.24%
PT rev (1m)10.83%
PT rev (3m)11.25%
EPS NQ rev (1m)3.32%
EPS NQ rev (3m)2.86%
EPS NY rev (1m)1.94%
EPS NY rev (3m)1.92%
Revenue NQ rev (1m)3.32%
Revenue NQ rev (3m)3.19%
Revenue NY rev (1m)1.79%
Revenue NY rev (3m)1.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.94 | ||
| Fwd PE | 17.05 | ||
| P/S | 5.31 | ||
| P/FCF | 24.06 | ||
| P/OCF | 22.29 | ||
| P/B | 6.54 | ||
| P/tB | N/A | ||
| EV/EBITDA | 20.11 |
EPS(TTM)3.89
EY5.02%
EPS(NY)4.55
Fwd EY5.86%
FCF(TTM)3.22
FCFY4.16%
OCF(TTM)3.48
OCFY4.49%
SpS14.6
BVpS11.86
TBVpS-5.3
PEG (NY)1.88
PEG (5Y)5.7
Graham Number32.22
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.53% | ||
| ROE | 22.04% | ||
| ROCE | 15.17% | ||
| ROIC | 12.86% | ||
| ROICexc | 15.76% | ||
| ROICexgc | 528.93% | ||
| OM | 22.52% | ||
| PM (TTM) | 17.9% | ||
| GM | 64.85% | ||
| FCFM | 22.07% |
ROA(3y)9.67%
ROA(5y)10.49%
ROE(3y)24.29%
ROE(5y)25.65%
ROIC(3y)14.02%
ROIC(5y)15.13%
ROICexc(3y)19.45%
ROICexc(5y)21.44%
ROICexgc(3y)218.06%
ROICexgc(5y)205%
ROCE(3y)17.32%
ROCE(5y)18.35%
ROICexgc growth 3Y7.78%
ROICexgc growth 5Y-7.79%
ROICexc growth 3Y-15.92%
ROICexc growth 5Y-13.75%
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%
F-Score7
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.21 | ||
| Debt/EBITDA | 1.37 | ||
| Cap/Depr | 38.47% | ||
| Cap/Sales | 1.75% | ||
| Interest Coverage | 8.27 | ||
| Cash Conversion | 87.98% | ||
| Profit Quality | 123.27% | ||
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.83 | ||
| Altman-Z | N/A |
F-Score7
WACC9.3%
ROIC/WACC1.38
Cap/Depr(3y)36.04%
Cap/Depr(5y)33.93%
Cap/Sales(3y)1.44%
Cap/Sales(5y)1.33%
Profit Quality(3y)126.8%
Profit Quality(5y)125.54%
High Growth Momentum
Growth
EPS 1Y (TTM)10.2%
EPS 3Y4.19%
EPS 5Y3.5%
EPS Q2Q%9.89%
EPS Next Y10.59%
EPS Next 2Y9.4%
EPS Next 3Y8.67%
EPS Next 5Y10.07%
Revenue 1Y (TTM)8.91%
Revenue growth 3Y3.19%
Revenue growth 5Y2.82%
Sales Q2Q%7.53%
Revenue Next Year7.24%
Revenue Next 2Y6.15%
Revenue Next 3Y5.75%
Revenue Next 5Y6.28%
EBIT growth 1Y11.75%
EBIT growth 3Y-3.72%
EBIT growth 5Y-2.35%
EBIT Next Year17.41%
EBIT Next 3Y9.5%
EBIT Next 5Y9.13%
FCF growth 1Y-27.19%
FCF growth 3Y1.39%
FCF growth 5Y-1.94%
OCF growth 1Y-24.88%
OCF growth 3Y2.38%
OCF growth 5Y-1.65%
CISCO SYSTEMS INC / CSCO FAQ
What is the ChartMill fundamental rating of CISCO SYSTEMS INC (CSCO) stock?
ChartMill assigns a fundamental rating of 5 / 10 to CSCO.
Can you provide the valuation status for CISCO SYSTEMS INC?
ChartMill assigns a valuation rating of 4 / 10 to CISCO SYSTEMS INC (CSCO). This can be considered as Fairly Valued.
Can you provide the profitability details for CISCO SYSTEMS INC?
CISCO SYSTEMS INC (CSCO) has a profitability rating of 7 / 10.
What is the valuation of CISCO SYSTEMS INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for CISCO SYSTEMS INC (CSCO) is 19.94 and the Price/Book (PB) ratio is 6.54.
What is the earnings growth outlook for CISCO SYSTEMS INC?
The Earnings per Share (EPS) of CISCO SYSTEMS INC (CSCO) is expected to grow by 10.59% in the next year.