Cisco Systems Valuation

CSCO Stock  USD 47.92  0.32  0.66%   
At this time, the firm appears to be undervalued. Cisco Systems shows a prevailing Real Value of $52.12 per share. The current price of the firm is $47.92. Our model approximates the value of Cisco Systems from analyzing the firm fundamentals such as Return On Equity of 0.31, profit margin of 0.23 %, and Current Valuation of 181.75 B as well as examining its technical indicators and probability of bankruptcy. In general, most investors favor obtaining undervalued instruments and abandoning overvalued instruments since, at some point, asset prices and their ongoing real values will blend. Key fundamental drivers impacting Cisco Systems' valuation include:
Price Book
4.247
Enterprise Value
181.8 B
Enterprise Value Ebitda
10.0319
Price Sales
3.4306
Forward PE
12.8041
Undervalued
Today
47.92
Please note that Cisco Systems' price fluctuation is very steady at this time. Calculation of the real value of Cisco Systems is based on 3 months time horizon. Increasing Cisco Systems' time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Our valuation method for Cisco Systems is useful when determining the fair value of the Cisco stock, which is usually determined by what a typical buyer is willing to pay for full or partial control of Cisco Systems. Since Cisco Systems is currently traded on the exchange, buyers and sellers on that exchange determine the market value of Cisco Stock. However, Cisco Systems' intrinsic value may or may not be the same as its current market price, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value.
Historical Market  47.92 Real  52.12 Target  55.39 Hype  47.88
The real value of Cisco Stock, also known as its intrinsic value, is the underlying worth of Cisco Systems Company, which is reflected in its stock price. It is based on Cisco Systems' financial performance, assets, liabilities, growth prospects, management team, or industry conditions. The intrinsic value of Cisco Systems' stock can be calculated using various methods such as discounted cash flow analysis, price-to-earnings ratio, or price-to-book ratio. That value may differ from its current market price, which is determined by supply and demand factors such as investor sentiment, market trends, news, and other external factors that may influence Cisco Systems' stock price. It is important to note that the real value of any stock may change over time based on changes in the company's performance.
52.12
Real Value
53.23
Upside
Estimating the potential upside or downside of Cisco Systems helps investors to forecast how Cisco stock's addition to their portfolios will impact the overall performance. We also use other valuation drivers to help us estimate the true value of Cisco Systems more accurately as focusing exclusively on Cisco Systems' fundamentals will not take into account other important factors:
Earnings
Estimates (0)
LowProjectedHigh
0.780.780.86
Details
Hype
Prediction
LowEstimatedHigh
46.7747.8848.99
Details
31 Analysts
Consensus
LowTarget PriceHigh
50.4055.3961.48
Details
Traditionally analysts and sophisticated investors use multiple methods for valuing a cash-flow-generating entity or its stock. For example, some money managers use Cisco Systems' intrinsic value based on its ongoing forecasts of Cisco Systems' financial statements. In contrast, other private, professional wealth advisors use a multiplier approach by looking to relative value analysis against Cisco Systems' closest peers. When choosing an evaluation method for Cisco Systems, ensure it is appropriate for the firm given its current financial situation and market classification. If more than one evaluation category is relevant, we suggest using both methods to arrive at a better estimate.

Cisco Systems Investments

(4.37 Billion)

Cisco Valuation Trend

Knowing Cisco Systems' actual value is paramount for traders to make sound investment determinations. Cisco Systems' real value is not only important for the investor to make better decisions but also for a more accurate overall view of Cisco Systems' financial worth over time since having this information enables investors and analysts to forecast the earnings more efficiently. Using both Cisco Systems' enterprise value as well as its market capitalization is the best way to gauging the value of the company and is usually enough for investors to make market timing descisions.

Cisco Market Cap

Cisco Systems is number one stock in market capitalization category among related companies. Market capitalization of Information Technology industry is currently estimated at about 195.62 Billion. Cisco Systems totals roughly 195.33 Billion in market capitalization claiming about 100% of equities under Information Technology industry.
Capitalization  Total debt  Valuation  Revenue  Workforce

Cisco Systems Valuation Ratios as Compared to Competition

Comparative valuation techniques use various fundamental indicators to help in determining Cisco Systems's current stock value. Our valuation model uses many indicators to compare Cisco Systems value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Cisco Systems competition to find correlations between indicators driving Cisco Systems's intrinsic value. More Info.
Cisco Systems is number one stock in price to earning category among related companies. It is number one stock in price to book category among related companies fabricating about  0.24  of Price To Book per Price To Earning. The ratio of Price To Earning to Price To Book for Cisco Systems is roughly  4.23 . As of the 17th of April 2024, Price To Book Ratio is likely to grow to 8.13. Comparative valuation analysis is a catch-all model that can be used if you cannot value Cisco Systems by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Cisco Systems' Stock. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Cisco Systems' earnings, one of the primary drivers of an investment's value.
Please note that valuation analysis is one of the essential comprehensive assessments in business. It evaluates Cisco Systems' worth, which you can determine by considering its current assets, liabilities and future cash flows. The investors' valuation analysis is an important metric that will give you a perspective on different companies. It helps you know the worth of the potential investment in Cisco Systems and how it compares across the competition.

About Cisco Systems Valuation

The stock valuation mechanism determines the current worth of Cisco Systems on a weekly basis. We use both absolute as well as relative valuation methodologies to arrive at the intrinsic value of Cisco Systems. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Cisco Systems based exclusively on its fundamental and basic technical indicators. By analyzing Cisco Systems's financials, quarterly and monthly indicators, and its related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Cisco Systems's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Cisco Systems. We calculate exposure to Cisco Systems's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Cisco Systems's related companies.
Last ReportedProjected for Next Year
Gross Profit41.1 B43.2 B
Pretax Profit Margin 0.27  0.30 
Operating Profit Margin 0.26  0.28 
Net Profit Margin 0.21  0.14 
Gross Profit Margin 0.64  0.70 

8 Steps to conduct Cisco Systems' Valuation Analysis

Company's valuation is the process of determining the worth of any company in monetary terms. It estimates Cisco Systems' potential worth based on factors such as financial performance, market conditions, growth prospects, and overall economic environment. The result of company valuation is a single number representing a Company's current market value. This value can be used as a benchmark for various financial transactions such as mergers and acquisitions, initial public offerings (IPOs), or private equity investments. To conduct Cisco Systems' valuation analysis, follow these 8 steps:
  • Gather financial information: Obtain Cisco Systems' financial statements, including balance sheets, income statements, and cash flow statements.
  • Determine Cisco Systems' revenue streams: Identify Cisco Systems' primary sources of revenue, including products or services offered, target markets, and pricing strategies.
  • Analyze market data: Research Cisco Systems' industry and market trends, including the size of the market, growth rate, and competition.
  • Establish Cisco Systems' growth potential: Evaluate Cisco Systems' management, business model, and growth potential.
  • Determine Cisco Systems' financial performance: Analyze its financial statements to assess its historical performance and future potential.
  • Choose a valuation method: Consider the Company's specific circumstances and choose an appropriate valuation method, such as the discounted cash flow (DCF) or comparable analysis method.
  • Calculate the value: Apply the chosen valuation method to the financial information and market data to calculate Cisco Systems' estimated value.
  • Review and adjust: Review the results and make necessary adjustments, considering any relevant factors that may have been missed or overlooked.
Note: This is a general outline, and different approaches and methods may be used depending on the type and size of the company being valued. We also recomment to seek professional assistance to ensure accuracy.
Cisco Systems' stock price is the clearest measure of market expectations about its performance. Without stock valuation, investors cannot independently discern whether Cisco Systems' value is low or high relative to the company's performance and growth projections. Determining the market value of Cisco Systems can be done in different ways, such as multiplying its stock price by its outstanding shares.
A single share of Cisco Systems represents a small ownership stake in the entity. As a stockholder of Cisco, your percentage of company ownership is determined by dividing the number of shares you own by the total number of shares outstanding and then multiplying that amount by 100. Owning stock in a company generally confers both corporate voting rights and income from any dividends paid to the stock owner.

Cisco Systems Dividends Analysis For Valuation

As of the 17th of April 2024, Dividend Paid And Capex Coverage Ratio is likely to grow to 2.97, while Dividends Paid is likely to drop about 4.7 B. . As of the 17th of April 2024, Retained Earnings is likely to drop to about 1.8 B. In addition to that, Retained Earnings Total Equity is likely to grow to about (1.1 B)
Last ReportedProjected for Next Year
Dividends Paid7.2 B4.7 B
Dividend Yield 0.03  0.02 
Dividend Payout Ratio 0.58  0.55 
Dividend Paid And Capex Coverage Ratio 2.82  2.97 
There are various types of dividends Cisco Systems can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of Cisco shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from Cisco Systems directly to its shareholders. There are other types of dividends that companies can issue, such as stock dividends or asset dividends. When Cisco pays a dividend, it has no impact on its enterprise value. It does, however, lowers the Equity Value of Cisco Systems by the value of the dividends paid out.

Cisco Systems Growth Indicators

Growth stocks usually refer to those companies expected to grow sales and earnings faster than the market average. Growth stocks typically don't pay dividends, often look expensive, and usually trading at a high P/E ratio. Nevertheless, such valuations could be relatively cheap if the company continues to grow, which will drive the share price up. However, since most investors are paying a high price for a growth stock, based on expectations, if those expectations are not fully realized, growth stocks can see dramatic declines. Note, investing in growth stocks can be very risky. If the company such as Cisco Systems does not do well, investors take a loss on the stock when it is time to sell. Also, because growth stocks typically do not pay dividends, the only opportunity an investor has to make money on their investment is when they eventually sell their shares.
Common Stock Shares Outstanding4.1 B
Quarterly Earnings Growth Y O Y-0.031
Forward Price Earnings12.8041

Cisco Systems Current Valuation Indicators

Valuation refers to the process of determining the present value of Cisco Systems and all of its assets. It can be calculated using a number of techniques. As many analysts who try to value Cisco we look at many different elements of the entity such as Cisco's management, its prospective future earnings, the current market value of the company's assets, as well as its capital structure formation. Cisco Systems' valuation analysis is also a process of estimating the intrinsic value of all assets and outstanding equities. There are different methodologies and models we use to develop the final Cisco Systems' valuation. The techniques such as discounted cash flow and fundamental indicators such as book value per share or market capitalization are well known and widely used across most financial advisers and money managers.
Valuations are an essential part of business, for companies themselves, but also for investors. For companies, such as Cisco Systems, valuations can help measure their progress and success and can help them track their performance in the market compared to others. In addition, investors can use Cisco Systems' valuations to help determine the worth of potential investments. They can do this by using data and information made public by a company. Regardless of who the valuation is for, it essentially describes Cisco Systems' worth.
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 Trending Equities to better understand how to build diversified portfolios, which includes a position in Cisco Systems. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in main economic indicators.
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

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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.