Cisco Systems (NASDAQ:CSCO) Shares Down 8.4% – Here’s Why

Cisco Systems, Inc. (NASDAQ:CSCO)’s share price dropped 8.4% during mid-day trading on Thursday . The stock traded as low as $111.48 and last traded at $113.47. 61,115,994 shares were traded during trading, an increase of 157% from the average daily volume of 23,772,275 shares. The stock had previously closed at $123.88.

More Cisco Systems News

Here are the key news stories impacting Cisco Systems this week:

• Positive Sentiment: AI demand is accelerating. Cisco reported fiscal Q4 revenue of approximately $17.3 billion, up 18% year over year, and adjusted EPS of $1.22 versus the $1.17 consensus estimate. AI infrastructure orders increased 4.5 times to $9.3 billion for fiscal 2026, while management expects approximately $7.5 billion of hyperscaler AI infrastructure revenue in fiscal 2027. Chuck Robbins Says AI Is Fueling a Networking Supercycle
• Positive Sentiment: Fiscal 2027 guidance exceeded expectations. Management forecast roughly 15% revenue growth, supported by hyperscaler spending, data-center switching and broader networking upgrades. Several firms—including UBS, Truist, Wells Fargo, KeyCorp, Morgan Stanley and Rosenblatt—raised their price targets and maintained bullish ratings, suggesting long-term upside if the AI networking cycle continues. Cisco Just Gave Investors Three Big Reasons to Be Bullish
• Neutral Sentiment: The market is demanding faster growth. Despite the earnings beat and upbeat outlook, Cisco’s shares have decreased because expectations were already elevated after a substantial rally. Investors are questioning whether the company’s AI momentum can remain strong beyond the current infrastructure buildout and whether Cisco’s premium valuation is justified. Cisco Shares Slide Despite Earnings Beat and Strong Guidance
• Negative Sentiment: Margin pressure is the primary concern. AI infrastructure growth is arriving mainly through lower-margin hardware, creating mix-related gross-margin compression and raising questions about how profitably Cisco can scale orders. HSBC downgraded CSCO to Hold from Buy and reduced its price target to $120 from $137, citing a lack of near-term catalysts even after the strong quarter. Cisco Beat on Every Line, Then Fell on What AI Costs to Ship

Analyst Ratings Changes

Several brokerages have recently commented on CSCO. BNP Paribas Exane boosted their target price on shares of Cisco Systems from $87.00 to $132.00 and gave the company an “outperform” rating in a research note on Thursday, May 14th. Barclays increased their target price on shares of Cisco Systems from $121.00 to $123.00 and gave the stock an “equal weight” rating in a research report on Thursday. UBS Group lifted their price target on shares of Cisco Systems from $132.00 to $138.00 and gave the company a “buy” rating in a report on Thursday. KeyCorp boosted their price target on shares of Cisco Systems from $130.00 to $135.00 and gave the company an “overweight” rating in a research report on Thursday. Finally, New Street Research upped their price objective on shares of Cisco Systems from $82.00 to $122.00 and gave the stock a “neutral” rating in a research note on Thursday, May 14th. One investment analyst has rated the stock with a Strong Buy rating, fifteen have issued a Buy rating and seven have assigned a Hold rating to the company’s stock. According to MarketBeat, Cisco Systems currently has an average rating of “Moderate Buy” and an average target price of $129.43.

Cisco Systems Trading Down 1.6%

The business has a 50 day simple moving average of $117.03 and a 200 day simple moving average of $99.09. The company has a debt-to-equity ratio of 0.39, a current ratio of 0.93 and a quick ratio of 0.81. The company has a market cap of $440.18 billion, a price-to-earnings ratio of 33.44, a price-to-earnings-growth ratio of 2.56 and a beta of 1.02.

Cisco Systems (NASDAQ:CSCO) last released its quarterly earnings results on Wednesday, August 12th. The network equipment provider reported $1.22 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.17 by $0.05. Cisco Systems had a return on equity of 30.16% and a net margin of 20.95%.The business had revenue of $17.25 billion during the quarter, compared to analysts’ expectations of $16.84 billion. During the same period in the previous year, the business posted $0.99 earnings per share. The firm’s revenue for the quarter was up 17.6% compared to the same quarter last year. Cisco Systems has set its FY 2027 guidance at 5.050-5.110 EPS and its Q1 2027 guidance at 1.320-1.340 EPS. As a group, equities analysts forecast that Cisco Systems, Inc. will post 4 EPS for the current year.

Cisco Systems Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Wednesday, October 21st. Stockholders of record on Friday, October 2nd will be given a dividend of $0.42 per share. This represents a $1.68 dividend on an annualized basis and a dividend yield of 1.5%. The ex-dividend date is Friday, October 2nd. Cisco Systems’s dividend payout ratio is presently 50.30%.

Insider Activity

In other news, EVP Thimaya K. Subaiya sold 7,127 shares of the stock in a transaction that occurred on Tuesday, June 16th. The shares were sold at an average price of $119.91, for a total transaction of $854,598.57. Following the sale, the executive vice president directly owned 140,857 shares of the company’s stock, valued at $16,890,162.87. This represents a 4.82% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Oliver Tuszik sold 2,607 shares of the firm’s stock in a transaction that occurred on Thursday, June 11th. The shares were sold at an average price of $121.12, for a total transaction of $315,759.84. Following the completion of the sale, the executive vice president directly owned 172,727 shares of the company’s stock, valued at approximately $20,920,694.24. This represents a 1.49% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 31,134 shares of company stock valued at $3,739,000 over the last three months. 0.01% of the stock is owned by insiders.

Institutional Investors Weigh In On Cisco Systems

A number of institutional investors and hedge funds have recently made changes to their positions in the company. Cozad Asset Management Inc. increased its position in Cisco Systems by 0.3% in the first quarter. Cozad Asset Management Inc. now owns 26,203 shares of the network equipment provider’s stock worth $2,033,000 after purchasing an additional 87 shares during the period. Dogwood Wealth Management LLC lifted its position in Cisco Systems by 3.9% during the 2nd quarter. Dogwood Wealth Management LLC now owns 2,413 shares of the network equipment provider’s stock valued at $283,000 after purchasing an additional 90 shares during the period. August Group Capital Ltd boosted its stake in shares of Cisco Systems by 2.0% in the 2nd quarter. August Group Capital Ltd now owns 4,723 shares of the network equipment provider’s stock valued at $555,000 after purchasing an additional 91 shares during the last quarter. Financial Insights Inc. boosted its stake in shares of Cisco Systems by 1.5% in the 1st quarter. Financial Insights Inc. now owns 6,220 shares of the network equipment provider’s stock valued at $483,000 after purchasing an additional 92 shares during the last quarter. Finally, CPA Asset Management Group LLC grew its position in shares of Cisco Systems by 1.8% during the 2nd quarter. CPA Asset Management Group LLC now owns 5,335 shares of the network equipment provider’s stock worth $627,000 after buying an additional 93 shares during the period. Institutional investors own 73.33% of the company’s stock.

Cisco Systems Company Profile

Cisco Systems, Inc is a global technology company that designs, manufactures and sells networking hardware, software and telecommunications equipment. Its core business focuses on enabling enterprise and service-provider networks through products such as routers, switches, network security appliances and wireless systems. Over time Cisco has broadened its portfolio to emphasize software-defined networking, cybersecurity, cloud infrastructure and edge computing solutions that help organizations build and manage modern IT environments.

In addition to hardware, Cisco offers a growing range of software platforms and subscription services for network management, security, analytics and collaboration.