Cisco Systems Stock Beneish M Score

CSCO Stock  USD 47.92  0.32  0.66%   
This module uses fundamental data of Cisco Systems to approximate the value of its Beneish M Score. Cisco Systems M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out Cisco Systems Piotroski F Score and Cisco Systems Altman Z Score analysis.
To learn how to invest in Cisco Stock, please use our How to Invest in Cisco Systems guide.
  
At this time, Cisco Systems' Short and Long Term Debt Total is very stable compared to the past year. As of the 17th of April 2024, Short Term Debt is likely to grow to about 2.7 B, though Net Debt is likely to grow to (1.9 B). At this time, Cisco Systems' Free Cash Flow Per Share is very stable compared to the past year. As of the 17th of April 2024, ROIC is likely to grow to 0.21, while Dividend Yield is likely to drop 0.02.
At this time, it appears that Cisco Systems is an unlikely manipulator. The earnings manipulation may begin if Cisco Systems' top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Cisco Systems executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Cisco Systems' earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-2.47
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.0

Focus
Asset Quality

1.26

Focus
Expense Coverage

1.0

Focus
Gross Margin Strengs

1.09

Focus
Accruals Factor

1.0

Focus
Depreciation Resistance

1.34

Focus
Net Sales Growth

1.05

Focus
Financial Leverage Condition

1.01

Focus

Cisco Systems Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Cisco Systems' auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables11.1 B10.6 B
Sufficiently Up
Slightly volatile
Total Revenue68.8 B65.5 B
Sufficiently Up
Slightly volatile
Total Assets123 B117.1 B
Sufficiently Up
Slightly volatile
Total Current Assets32.1 B49.9 B
Way Down
Pretty Stable
Non Current Assets Total70.6 B67.3 B
Sufficiently Up
Slightly volatile
Property Plant Equipment2.6 B1.9 B
Significantly Up
Slightly volatile
Depreciation And Amortization1.6 BB
Significantly Down
Pretty Stable
Selling General AdministrativeB2.8 B
Sufficiently Up
Slightly volatile
Total Current Liabilities37.8 B36 B
Sufficiently Up
Slightly volatile
Non Current Liabilities Total31.6 B30.1 B
Sufficiently Up
Slightly volatile
Short Term Debt2.7 BB
Significantly Up
Pretty Stable
Long Term Debt15.3 B7.7 B
Way Up
Slightly volatile
Operating Income18.1 B17.3 B
Sufficiently Up
Slightly volatile
Total Cash From Operating Activities24 B22.9 B
Sufficiently Up
Slightly volatile
Short Term Investments22.6 B18.4 B
Fairly Up
Slightly volatile
Long Term Investments4.8 B4.6 B
Sufficiently Up
Slightly volatile
Gross Profit Margin0.70.6402
Significantly Up
Slightly volatile

Cisco Systems Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Cisco Systems' different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Cisco Systems in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Cisco Systems' degree of accounting gimmicks and manipulations.

About Cisco Systems Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Depreciation And Amortization

1.6 Billion

At this time, Cisco Systems' Depreciation And Amortization is very stable compared to the past year.

Cisco Systems Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Cisco Systems. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201920202021202220232024 (projected)
Net Receivables10.5B10.1B10.5B9.2B10.6B11.1B
Total Revenue49.3B49.8B51.6B57.0B65.5B68.8B
Total Assets94.9B97.5B94.0B101.9B117.1B123.0B
Total Current Assets43.6B39.1B36.7B43.3B49.9B32.1B
Net Debt2.8B2.4B2.4B(1.7B)(2.0B)(1.9B)
Short Term Debt3.0B2.5B1.1B1.7B2.0B2.7B
Long Term Debt11.6B9.0B8.4B6.7B7.7B15.3B
Operating Income13.6B12.8B14.0B15.0B17.3B18.1B
Investments4.4B(5.3B)2.3B(5.1B)(4.6B)(4.4B)

Cisco Systems ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Cisco Systems' sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Cisco Systems' managers, analysts, and investors.
Environment Score
Governance Score
Social Score

About Cisco Systems Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Cisco Systems's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Cisco Systems using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Cisco Systems based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.

Pair Trading with Cisco Systems

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Cisco Systems position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Cisco Systems will appreciate offsetting losses from the drop in the long position's value.

Moving against Cisco Stock

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The ability to find closely correlated positions to Cisco Systems could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Cisco Systems when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Cisco Systems - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Cisco Systems to buy it.
The correlation of Cisco Systems is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Cisco Systems moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Cisco Systems moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Cisco Systems can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching
When determining whether Cisco Systems offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Cisco Systems' financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Cisco Systems Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Cisco Systems Stock:
Check out Cisco Systems Piotroski F Score and Cisco Systems Altman Z Score analysis.
To learn how to invest in Cisco Stock, please use our How to Invest in Cisco Systems guide.
Note that the Cisco Systems information on this page should be used as a complementary analysis to other Cisco Systems' statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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When running Cisco Systems' price analysis, check to measure Cisco Systems' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Cisco Systems is operating at the current time. Most of Cisco Systems' value examination focuses on studying past and present price action to predict the probability of Cisco Systems' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Cisco Systems' price. Additionally, you may evaluate how the addition of Cisco Systems to your portfolios can decrease your overall portfolio volatility.
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Is Cisco Systems' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Cisco Systems. If investors know Cisco will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Cisco Systems listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.03)
Dividend Share
1.56
Earnings Share
3.29
Revenue Per Share
14.067
Quarterly Revenue Growth
(0.06)
The market value of Cisco Systems is measured differently than its book value, which is the value of Cisco that is recorded on the company's balance sheet. Investors also form their own opinion of Cisco Systems' value that differs from its market value or its book value, called intrinsic value, which is Cisco Systems' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Cisco Systems' market value can be influenced by many factors that don't directly affect Cisco Systems' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Cisco Systems' value and its price as these two are different measures arrived at by different means. Investors typically determine if Cisco Systems is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Cisco Systems' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.