CISCO SYSTEMS, INC. (CSCO) Stock Analysis
CISCO SYSTEMS, INC. (CSCO) Stock Analysis
Analysis from 10-Q filed 2025-11-18. Data as of Q1 2026.
Overall Grade: F (Concerning)
CISCO SYSTEMS, INC. faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 15.2% | Solid returns |
| FCF Margin | 20.7% | Strong cash generation |
| Debt/Equity | 0.6x | Moderate leverage |
Investment Thesis: Strong return on invested capital of 15.2% suggests durable competitive advantages and efficient capital allocation.
Explore CISCO SYSTEMS, INC.: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: CISCO SYSTEMS, INC. earns 15.2% ROIC, Top 25% in Technology
CISCO SYSTEMS, INC.'s trailing-twelve-month ROIC of 15.2% ranks Top 25% in Technology companies (sector median: 5.0%), driven by NOPAT margin of 19.4% combined with asset turnover of 0.5x. Source: 10-Q filed 2025-11-18. Gross margin of 64.8% with operating margin at 22.7% reflects strong pricing power.
| Metric | CSCO | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 15.2% | Good | Above sector median of 5.0% |
| Return on Equity (ROE) | 23.8% | Excellent | Efficient use of shareholder equity |
| Gross Margin | 64.8% | Excellent | Strong pricing power |
| Operating Margin | 22.7% | Excellent | Efficient operations |
Cash Flow: CISCO SYSTEMS, INC. generates $12.2B FCF at 20.7% margin, positive NaN/8 quarters
CISCO SYSTEMS, INC. generated $12.2B in free cash flow (TTM), a 20.7% FCF margin, a margin that ranks Top 25% in Technology. Operating cash flow exceeds net income by 1.2x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-11-18.
| Metric | CSCO | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 20.7% | Excellent | Excellent cash conversion |
| Free Cash Flow (TTM) | $12.2B | Good | Positive cash generation |
| OCF/Net Income | 1.2x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: CISCO SYSTEMS, INC. at 0.6x leverage
CISCO SYSTEMS, INC.'s debt-to-equity ratio of 0.6x reflects moderate leverage. Total debt of $30.1B offset by $15.8B in cash. Source: 10-Q filed 2025-11-18.
| Metric | CSCO | Rating | Context |
|---|---|---|---|
| Debt to Equity | 0.6x | Good | Moderate leverage |
| Net Cash Position | $-14.3B | Warning | Net debt position |
Valuation: CISCO SYSTEMS, INC. trades at 26.7x earnings
CISCO SYSTEMS, INC. trades at a P/E of 26.7x. Free cash flow yield of 4.1% reflects market expectations for growth.
| Metric | CSCO | Rating | Context |
|---|---|---|---|
| P/E Ratio | 26.7x | Adequate | Premium valuation |
| EV/Sales | 5.2x | Adequate | Growth premium priced in |
| FCF Yield | 4.1% | Good | Lower cash yield |
| Dividend Yield | 2.2% | Adequate | Growth focus over income |
Capital Allocation: CISCO SYSTEMS, INC. returns 4.3% shareholder yield
CISCO SYSTEMS, INC.'s total shareholder yield is 4.3% (dividends 2.2% + buybacks 2.1%). Source: 10-Q filed 2025-11-18.
| Metric | CSCO | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 4.3% | Good | Dividend + buyback yield combined |
| Buyback Yield | 2.1% | Adequate | Active share repurchases |
| Total Capital Returned (TTM) | $12.6B | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 15.2% | Top 25% | 3.0x above |
| Free Cash Flow Margin | 20.7% | Top 25% | 2.4x above |
| Gross Margin | 64.8% | Top 50% | 1.3x above |
| Operating Margin | 22.7% | Top 25% | 4.8x above |
| Return on Equity (ROE) | 23.8% | Top 25% | 4.6x above |
| P/E Ratio | 26.7x | N/A | - |
Financial Scorecard
| Metric | CSCO | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 15.2% | Good | Top 25% of sector (median: 5.0%) |
| Free Cash Flow Margin | 20.7% | Excellent | Top 25% of sector (median: 8.5%) |
| Gross Margin | 64.8% | Excellent | Top 50% of sector (median: 51.1%) |
| Debt to Equity Ratio | 63.0% | Good | Moderate leverage |
| P/E Ratio (Price-to-Earnings) | 26.7x | Adequate | Growth premium |
| Free Cash Flow Yield | 4.1% | Adequate | Moderate yield |
Frequently Asked Questions
Q: What is CISCO SYSTEMS, INC.'s Return on Invested Capital (ROIC)?
CISCO SYSTEMS, INC. (CSCO) has a trailing twelve-month Return on Invested Capital (ROIC) of 15.2%. This compares above the sector median of 5.0%. An ROIC between 12-20% indicates solid capital allocation and sustainable competitive position.
Q: What is CISCO SYSTEMS, INC.'s Free Cash Flow Margin?
CISCO SYSTEMS, INC. (CSCO) has a free cash flow margin of 20.7%, generating $12.2 billion in free cash flow over the trailing twelve months. A FCF margin above 20% indicates excellent cash conversion and a high-quality business model.
Q: Is CISCO SYSTEMS, INC. stock overvalued or undervalued?
CISCO SYSTEMS, INC. (CSCO) trades at a P/E ratio of 26.7x, which is above the sector median of N/A. The EV/Sales multiple is 5.2x. Free cash flow yield is 4.1%, which is in line with market averages.
Q: Does CISCO SYSTEMS, INC. pay a dividend?
CISCO SYSTEMS, INC. (CSCO) currently pays a dividend yield of 2.2%. Including share buybacks, the total shareholder yield is 4.3%. This yield is moderate, suggesting a balance between income and growth reinvestment.
Q: How much debt does CISCO SYSTEMS, INC. have?
CISCO SYSTEMS, INC. (CSCO) has a debt-to-equity ratio of 0.6x with total debt of $30.1 billion. Net debt position is $14.3 billion.
Q: What is CISCO SYSTEMS, INC.'s revenue and earnings growth?
CISCO SYSTEMS, INC. (CSCO) grew revenue by 9.0% year-over-year. Earnings per share increased by 21.4% compared to the prior year. Modest growth indicates a mature business with stable demand.
Q: Is CISCO SYSTEMS, INC. buying back stock?
CISCO SYSTEMS, INC. (CSCO) repurchased $6.1 billion of stock over the trailing twelve months. This represents a buyback yield of 2.1%.
Q: How does CISCO SYSTEMS, INC. compare to competitors in Technology?
Compared to other companies in Technology, CISCO SYSTEMS, INC. (CSCO) shows: ROIC of 15.2% is above the sector median of 5.0% (Top 24%). FCF margin of 20.7% exceeds the sector median of 8.5% (Top 24% of sector). Gross margin at 64.8% is 13.7 percentage points higher than sector peers. These rankings are based on MetricDuck's analysis of all Technology companies with available SEC filings.
Q: What warning signs should I watch for with CISCO SYSTEMS, INC.?
CISCO SYSTEMS, INC. (CSCO) shows no major financial warning signs based on current metrics. However, investors should always monitor: 1) Margin compression trends, 2) Cash flow consistency, 3) Debt levels relative to cash generation, and 4) Changes in competitive positioning.
Data Source: Data sourced from 10-Q filed 2025-11-18. TTM metrics as of Q1 2026.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.