Splunk Inc (SPLK)
NASDAQ (NGS) NASDAQ (NGS) Primary 
Cisco: A New Chapter
Cisco Systems, Inc.'s stock has surged 20% post-earnings, driven by the Splunk acquisition and a bullish chart, signaling a new growth chapter. Revenues rose 9.4% to $14 billion, with product revenue up 11% and services up 6%, largely thanks to Splunk. Margin expansion was a key strength, with gross margins improving across all segments, boosting operating income by 15%.
Cisco: Acquisition Of Splunk To Boost Growth
Cisco's acquisition of Splunk, valued at $28 billion, is expected to enhance Cisco's gross margins and revenue growth despite a $5.74 billion premium paid on the acquisition. The deal will boost Cisco's gross margins from 64.7% to 66.5% by 2029, driven by Splunk's higher software-focused gross margins. We expect Cisco's revenue growth to increase to 6.3% on average through 2029, significantly benefiting from Splunk's integration and cross-selling opportunities.
Will Splunk And Network Recovery Drive Cisco's Q4 Results?
Cisco Systems Inc (NASDAQ: CSCO) stock has underperformed this year, falling by about 2% since early January. In comparison, Palo Alto Networks stock has gained about 13% over the same period.
Cisco: The Valuation Case Is Strong; AI And Splunk Help
AI stocks' forward-12-month earnings growth estimates are falling, contrasting with rising S&P 500 EPS trends, allowing for some new entrants into the key theme. Cisco's EPS revisions are mixed, but potential growth opportunities in AI could lead to a higher valuation amid subdued expectations. Cisco's earnings, valuation, dividend yield, and free cash flow forecasts suggest the stock is undervalued while its technical situation is less sanguine.
Will Higher Software Sales, Splunk Deal Drive Cisco Stock Back To $60?
Cisco Systems Inc (NASDAQ: CSCO) currently trades at $47 per share, about 26% below its pre-inflation shock high of about $64 seen on December 29, 2021. The sell-off has been driven by several factors.
Is Cisco Undervalued At $46, Amid Network Recovery And Splunk Revenue Upside?
Cisco Systems Inc (NASDAQ: CSCO) stock has underperformed this year, falling by about 9% since early January. Cisco's product sales have seen a slowdown as customers have been focused on installing and implementing the products purchased over the last few quarters.
Cisco Surpasses Estimates As It Finally Gets Some AI Action Despite Steepest Revenue Drop Since 2009
On Wednesday, Cisco Systems Inc Fiscal Third Quarter Highlights For the quarter ended on April 27th, Cisco reported revenue contracted about 13% as it amounted to $12.7 billion, still surpassing LSEG’s estimate of $12.53 billion. Adjusted earnings amounted to 88 cents per share, also topping LSEG’s consensus of 82 cents. But net income tanked 41% to $1.89 billion, or 46 cents per share. Networking revenue which makes the majority of sales also melted as it dropped by 27% to $6.52 billion. Cisco made a big step forward in the AI direction. During the quarter, the $28 billion acquisition of security software maker Splunk was completed and although it lowered the adjusted earnings per share by a penny, it also lifted revenue with a $413 million infusion. Over time, Cisco is expected to lower costs. But what’s more important is that Cisco’s acquisition of Splunk means a big boost in its cybersecurity and AI ambitions, as this is its biggest acquisition in its history that spans over a big less than four decades. With Splunk, Cisco is gaining a tool to face off its rivals, like Palo Alto Networks Inc Cisco Altered Its Fiscal 2024 Guidance Cisco lifted the full year revenue guidance range it provided in February, as it now expects a figure between $53.6 billion and $53.8 billion. It also narrowed its adjusted earnings range as it now expects them between $3.69 to $3.71. As for fiscal 2025 revenue, CFO Scott Herren expects low- to mid-single digits growth rate. Cisco CEO Chuck Robbins expressed his content that Cisco is approaching the end of supply chain challenges it has been struggling with for years. Cisco has undoubtedly been undergoing many changes and although recent quarters have been particularly challenging, Cisco is finally getting some AI action while there are early signs that enterprise spending is starting to recover.
Cisco: 5K New Splunk Customers Means $1.4B In Potential Additional Revenue
Cisco beat EPS and revenue estimates, raising its 2024 revenue outlook to $53.6-$53.8 billion. The stock price remained flat, decreasing by only 0.13%. The fair stock price estimate is $63.63, with a future target of $92.46 by 2029, supporting a "strong-buy" rating and implying a 28.1% upside and 14.4% annual return. Cisco's valuation is boosted by Splunk, which added around $4.21 billion in new revenue, potentially increasing to $5.62 billion for FY2025 as Cisco integrates Splunk with its customer base.
