Cisco Systems, Inc.
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Cisco's FY2026 (ended 25 Jul) delivered genuine fundamental acceleration — quarterly revenue growth stepped up from 7.5% in Q1 to 17.6% in Q4, full-year revenue rose 11.8% to $63.3B, and operating margin expanded to 24.3% driving 30.6% EPS growth to $3.33 — but at $112.20 the stock trades at 33.39x trailing P/E, a 40.5% premium to the peer median of 23.77x, with smart money slightly negative at -0.01 as of Q2 2026 and insiders net selling $201M over 24 months.
The AI-infrastructure tailwind is real and the technical picture is constructive (price above both the 50-day and 200-day moving averages with a positive MACD histogram), yet the valuation premium already discounts much of the improvement and the ownership signals do not confirm chasing at current levels.
What could go wrong
- Valuation compression. At 33.39x P/E and 23.21x EV/EBITDA — premiums of 40.5% and 23.1% to peer medians — any deceleration in revenue growth could trigger a sharp de-rating.
- Smart money outflows. Smart money score deteriorated from 0.088 in Q1 2026 to -0.01 as of Q2 2026 (ended 30 Jun), suggesting institutional positioning is turning cautious.
- Persistent insider selling. Over 24 months insiders net disposed $201.2M in value across 176 dispositions versus 50 acquisitions; while recent September 2026 transactions were acquisitions, the broader pattern remains net negative.
- Leverage from acquisitions. Total debt rose from $8.39B in FY2023 to $29.53B in FY2026, increasing balance sheet risk if growth disappoints.
What would change my mind
Where this comes from: fundamentals, year to 25 Jul · FY26 results · fundamentals and earnings vs estimates · peer comparison, 2 Oct. Orin's read on CSCO; not advice.
How has the share price moved?
Up 56.0% over twelve months, from $71.39 on 27 Oct 2025 to $111.38 at the Tue 27 Oct 2026 close. Its highest close in that time was $130.00 on 4 Jun 2026; the last close is 14.3% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 90.4M, on 20 Mar 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All CSCO filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $42.1B | 0.6% |
| Vanguard Capital Management | $28.8B | 0.6% |
| State Street | $23.2B | 0.7% |
| Invesco | $16.2B | 1.3% |
| Vanguard Portfolio Management | $14.0B | 0.6% |
| Geode Capital Management | $11.8B | 0.6% |
| Morgan Stanley | $9.4B | 0.5% |
| FMR | $8.9B | 0.4% |
| Capital Research Global Investors | $7.9B | 1.1% |
| Norges Bank | $6.4B | 0.6% |
192 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 228 Form 4 filings; open-market trades net −$115.6M. Of the 50 on hand, 0 were open-market purchases and 26 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about CSCO
Orin answers questions about CSCO from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 33.1× its last 12 months of profit (Tue 27 Oct close) — higher than in 4 of its last 5 fiscal years (middle 18.8×); the typical Technology company on the NASDAQ is at 46.1×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 33.1×above usual | 18.8× | 46.1× |
| P/S | 6.93×above usual | 3.74× | — |
| EV/EBITDA | 23.1×above usual | 13.8× | — |
| P/B | 8.8×above usual | 4.8× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $130 (from $110 to $150) — 17% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$130
$110 – $150 · +17% against the last close
- 12 buy or overweight
- 4 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 33.1× its last 12 months of profit; the middle P/E of the 5 companies it is compared to that made a profit is 58.3×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| CSCOCisco Systems, Inc. | $439B | 33.1× | 23.1× | 64.5% | 21.0% | 27% |
| ANETArista Networks, Inc. | $236B | 58.3× | 45.9× | 63.0% | 38.4% | 31% |
| CIENCiena Corporation | $50B | 76.0× | 49.0× | 44.1% | 10.9% | 23% |
| EXTRExtreme Networks, Inc. | $3B | 74.4× | 37.1× | 61.5% | 3.3% | 51% |
| MSIMotorola Solutions, Inc. | $86B | 41.2× | 25.4× | 50.6% | 16.5% | 78% |
| VISNVistance Networks, Inc. | $1B | 1.0× | 2.8× | 38.5% | 72.9% | 49% |
- VISN: dividend yield marked one-off — most of the last 12 months' payouts were special or irregular, so the yield is not income that repeats.
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 33.1× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now33.1×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Technology companies on the NASDAQ were priced at a typical 46.1× their yearly profit (Tue 27 Oct close).
- Now46.1×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $57 a share — 49% below the $112.03 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $57 | 49% below $112.03 |
| Levered | $58 | 48% below $112.03 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.