How will the August 16 Earnings be for Cisco (CSCO) Stock? 

• CSCO Stock gained 1.68% in a week, 11.51% YTD, and 16.76% in a year. 
• Cisco Systems Inc. will fully acquire Working Group Two for $150 Million. 

Cisco Systems Inc. will release earnings on August 16 and is to acquire Working Group Two, while CSCO Stock gained 0.72%. On August 10, 2023, Telenor announced selling all its shares of the software company Working Group Two to Cisco Systems Inc. (NASDAQ: CSCO). Cisco will fully acquire the software company for $150 Million. 

Cisco Systems Inc. (CSCO) Stock: Financial Analysis

Cisco Whale has recently been bullish on the stock, with its options history noticing 10 strange trades. About 60% of investors have been bullish while 40% were bearish. The two essential metrics of growing return on capital employed (ROCE) and expansion in the amount of capital employed play an indispensable role in Cisco’s financials. 

Cisco Systems Inc. has a ROCE of 21%, indicating great returns and positive financials. Compared to the communications industry average of 9.1%, Cisco is in a good position. The ROCE growth can be attributed to the company keeping the capital employed relatively flat for the last five years, taking ROCE to surge 44% in the time frame.

Cisco Systems Inc. (NASDAQ: CSCO): Technical Analysis

At press time, CSCO stock is trading at $53.37, gaining 0.72%; previous close and open were at $52.99 and $53.41, respectively. The 52-week range is from $38.60 to $54.14, indicating a push could reach new highs. With an average volume of 18.47 Million shares, the market cap is $217.486 Billion. 

The trailing twelve-month (TTM) price-to-earnings (P/E) ratio is 19.13, indicative of a slightly undervalued stock price. At the same time, the (TTM) earnings per share (EPS) is $2.79, showcasing strength. Analysts placed a 2.48 rating for “hold” and estimated a price target of $56.95 with an upside of 6.7%. 

Cisco released its last earnings on May 17, 2023, where the reported revenue of $14.571 Billion surpassed the expected value of $14.395 Billion by 1.22%. At the same time, the reported earnings of $1.00 per share exceeded the estimated value of $0.972 per share by 2.83%. After the announcement, CSCO’s stock price fell 4.17% but soon jumped 7.44%. 

As compared to the previous quarter, the revenue and EPS gained 13.53% and 14.94%, respectively. The subsequent earnings will be announced on August 16, 2023, where the revenue should be around $15.05 Billion, and earnings will be around $1.058 per share. Zack Consensus expects earnings of $1.06 per share with a year-over-year (YoY) gain of 27.7%, while the revenue is $15.05 Billion with a (YoY) gain of 14.8%. 

Operating expenses gained 15.25% to $5.20 Billion, and the operating margin is 26.50%. Net income swelled by 5.52% to $3.21 Billion, net profit margin dropped by 7.08% to 22.04, and profit margin stood at 20.89%. With a gross profit (TTM) of $32.25 Billion, the revenue (TTM) is $54.9 Billion. 

Cisco Systems Inc. (CSCO) Stock: Candle Exploration

Ascending trend line, 200EMA, and 50EMA indicate momentum and also, the RSI at 60.34 these three indicator combined hints at a slight jump. If the earnings come out positive, the stock price could enter the selling zone creating new highs for 2023. However, the recent inflation data might hamper the rally. 

If the price drops from the current point, it should bounce off the trendline or 50EMA or come and test immediate resistance at $50.12. It should be a positive sign as long as the price is above the $50 mark. Experts see nothing to pull the price to S1 at $45.60 soon. 

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