Cisco Systems Inc
Cisco Systems Inc Fundamental Analysis
Cisco Systems Inc (CSCO.NE) shows strong financial fundamentals with a PE ratio of 14.69, profit margin of 18.76%, and ROE of 23.80%. The company generates $163.9B in annual revenue with moderate year-over-year growth of 5.30%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 62.5/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze CSCO.NE's fundamental strength across five key dimensions:
Efficiency Score
WeakCSCO.NE struggles to generate sufficient returns from assets.
Valuation Score
ModerateCSCO.NE shows balanced valuation metrics.
Growth Score
ModerateCSCO.NE shows steady but slowing expansion.
Financial Health Score
ModerateCSCO.NE shows balanced financial health with some risks.
Profitability Score
ExcellentCSCO.NE achieves industry-leading margins.
Key Financial Metrics
Is CSCO.NE Expensive or Cheap?
P/E Ratio
CSCO.NE trades at 14.69 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, CSCO.NE's PEG of 4.82 indicates potential overvaluation.
Price to Book
The market values Cisco Systems Inc at 3.45 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 25.25 times EBITDA. This signals the market has high growth expectations.
How Well Does CSCO.NE Make Money?
Net Profit Margin
For every $100 in sales, Cisco Systems Inc keeps $18.76 as profit after all expenses.
Operating Margin
Core operations generate 22.99 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $23.80 in profit for every $100 of shareholder equity.
ROA
Cisco Systems Inc generates $9.09 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Cisco Systems Inc produces operating cash flow of $36.98B, showing steady but balanced cash generation.
Free Cash Flow
Cisco Systems Inc generates strong free cash flow of $33.97B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $3.11 in free cash annually.
FCF Yield
CSCO.NE converts 2.72% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
14.69
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
4.82
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.45
vs 25 benchmark
P/S Ratio
Price to sales ratio
7.62
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.63
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.96
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.24
vs 25 benchmark
ROA
Return on assets percentage
0.09
vs 25 benchmark
ROCE
Return on capital employed
0.16
vs 25 benchmark
How CSCO.NE Stacks Against Its Sector Peers
| Metric | CSCO.NE Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 14.69 | 36.81 | Better (Cheaper) |
| ROE | 23.80% | 974.00% | Weak |
| Net Margin | 18.76% | 5914823191.00% | Weak |
| Debt/Equity | 0.63 | 0.34 | Weak (High Leverage) |
| Current Ratio | 0.96 | 4.93 | Weak Liquidity |
| ROA | 9.09% | -294975.00% (disorted) | Weak |
CSCO.NE outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Cisco Systems Inc's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
22.43%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
-3.28%
Industry Style: Growth, Innovation, High Beta
DecliningFCF CAGR
-1.98%
Industry Style: Growth, Innovation, High Beta
Declining