Income Statement Flow (TTM) | Source: Yahoo Finance
Source: Cash Flow Statement | LFCF = Operating Cash Flow - CapEx - Interest Expense
Fair Value: $95.70
+18.3% Upside
Stock appears undervalued with 18.3% upside to fair value. Medium confidence based on valuation spread and data quality.
Cisco Systems, Inc. (CSCO) currently trades at $80.88, representing a 18.3% discount to our calculated fair value of $95.70.
Key Strengths: Strong balance sheet (Net Debt/EBITDA: 0.9x); High profit margins (17.9%); Low short interest.
Key Risks: No significant concerns identified.
The company generates $12.41B in levered free cash flow annually, providing real cash returns to shareholders. Wall Street consensus is buy with a mean price target of $86.95.
| Criterion | Status | Notes |
|---|---|---|
| ≤4 operating segments | PASS | Segment count estimated from sector classification. Verify in 10-K for accuracy. |
| Top 2 segments ≥70% of revenue | PASS | Revenue concentration estimated. Verify segment breakdown in 10-K. |
| ≤3 material geographic regions | PASS | Most US-listed companies report US vs International (2 regions). |
| No exotic debt instruments or off-balance-sheet complexity | PASS | Review 10-K for convertibles, derivatives, and off-balance-sheet items. |
Recommendation: PROCEED TO VALUATION
Cisco Systems, Inc. designs, develops, and sells technologies that help to power, secure, and draw insights from the internet in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. The company offers data center switching; network security, identity and access management, and secure access service edge; threat intelligence, detection, and response solutions; interconnects public and private wireline and mobile networks, delivering connectivity to campus, data center, and branch networks; WEBEX suite, collaboration devices, and contact center; communication platform as a service software, including perpetual licenses, subscription arrangements, and hardware solutions; network assurance, monitoring and analytics, and observability suite; issue resolution, software support, and hardware replacement; professional services, such as planning, design, implementation, and high-value consulting; service and support packages, financing, and managed network services; and regional, national, and international wireline carriers, webscale products, internet, and cable. It also delivers connectivity to campus, data center, and branch networks; wireless products, including indoor and outdoor wireless coverage designed for seamless roaming use of voice, video, and data applications; end-to-end collaboration solutions through cloud, on-premise, or within hybrid cloud environments, transition collaboration solutions from on-premise to the cloud; and network assurance, monitoring and analytics, and observability suite. In addition, it offers technical support and advisory services. The company serves businesses, public institutions, governments, and service providers. It sells its products and services directly, through systems integrators, service providers, resellers, and distributors. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.
| Market Capitalization | $319.56B |
| (+) Total Debt | $29.64B |
| (-) Cash & Equivalents | $15.74B |
| Net Debt | $13.90B |
| Enterprise Value | $333.47B |
| Metric | Value | What It Means |
|---|---|---|
| Net Debt / EBITDA | 0.89x | Very Strong |
| Interest Coverage | 8.5x | Strong |
| Debt / Equity | 63.2% | Elevated |
| Current Ratio | 0.93 | Review - may struggle with short-term obligations |
Overall: Balance sheet is adequate with some areas to monitor.
Industry: Communication Equipment | Data: TTM (Trailing 12 Months) as of 2026-02-02 | Source: Yahoo Finance
| Company | Market Cap | P/E | Forward P/E | EV/EBITDA | Profit Margin |
|---|---|---|---|---|---|
| NVDA | $4521.7B | 46.1x | 24.2x | 40.8x | 53.0% |
| GOOGL | $4162.0B | 33.9x | 30.5x | 27.7x | 32.2% |
| AAPL | $3963.9B | 34.2x | 29.1x | 25.1x | 27.0% |
| MSFT | $3149.7B | 26.6x | 22.4x | 18.4x | 39.0% |
| META | $1788.5B | 30.1x | 20.0x | 17.8x | 30.1% |
| CSCO (Target) | $319.6B | 31.2x | 18.1x | 20.6x | 17.9% |
| Peer Average (excl. target) | - | 33.9x | 24.2x | 25.1x | 32.2% |
| Method | Inputs | Fair Value |
|---|---|---|
| Equity (TTM EPS) | EPS: $2.59 x 33.9x P/E | $87.80 |
| Equity (Forward EPS) | EPS: $4.47 x 33.9x P/E | $151.65 |
| EV-Based (EBITDA) | EBITDA: $15.62B x 25.1x | $95.70 |
| Headline Fair Value | Median value used (spread 57.2% exceeds 15% threshold) | $95.70 |
Assessment: Strong positive profile with multiple favorable factors.
CSCO trades at 31.2x TTM P/E and 18.1x Forward P/E. This compares to peer averages of 33.9x TTM and 24.2x Forward P/E.
The company generates positive levered free cash flow of $12.41B, demonstrating its ability to generate real cash after all obligations. The 3.9% LFCF yield is attractive.
21 analysts cover this stock with a consensus buy rating. Price targets range from $67 to $100, with a mean of $87.
16.49 - Neutral/Low Fear
Score: 62/100
143.65
SPY YTD: 17.7% | RSP YTD: 12.3%
No customer/supplier data available for this company. Data is curated from SEC 10-K filings for major tech companies.
Track Record: 8 beats, 0 misses, 0 in-line out of 8 quarters | 100% Beat Rate
| Date | EPS Estimate | EPS Actual | Result | Surprise % |
|---|---|---|---|---|
| 2025-11-12 | $0.98 | $1.00 | BEAT | 1.8% |
| 2025-08-13 | $0.98 | $0.99 | BEAT | 1.3% |
| 2025-05-14 | $0.92 | $0.96 | BEAT | 4.6% |
| 2025-02-12 | $0.91 | $0.94 | BEAT | 3.4% |
| 2024-11-13 | $0.45 | $0.68 | BEAT | 51.5% |
| 2024-08-14 | $0.85 | $0.87 | BEAT | 2.5% |
| 2024-05-15 | $0.82 | $0.88 | BEAT | 7.7% |
| 2024-02-14 | $0.84 | $0.87 | BEAT | 4.0% |
All financial data sourced from:
Click any blue number throughout the report to view its source.
This analysis is generated automatically using publicly available data and should not be considered as financial advice. All figures are sourced from Yahoo Finance and may contain inaccuracies. Always verify data with primary sources (SEC filings, company IR) before making investment decisions.
Past performance does not guarantee future results. Investing involves risk, including the possible loss of principal.
Levered FCF is cash that can't be faked. Unlike earnings which can be manipulated through accounting (depreciation schedules, revenue recognition, etc.), cash flow is simple: the money is either in the bank or it's not.
This metric shows how much actual cash the company generates after paying for:
A company with strong Levered FCF can pay dividends, buy back shares, pay down debt, or invest in growth - all from real cash, not accounting profits.
Customers and suppliers report earnings BEFORE the company you're analyzing. Their results give you early signals about demand and supply chain health.
Customer Example: If Microsoft (AMD customer) beats revenue estimates by 20%, it likely means they bought more chips than analysts expected. This is bullish for AMD's upcoming earnings.
Supplier Example: If TSMC (AMD supplier) reports strong demand from AMD, that confirms AMD's production is ramping up.
By the time AMD reports, you already have data points from 5+ related companies. Smart analysts piece these together to predict earnings before they're announced.
Not all revenue is equal. Different business segments have different growth rates and profit margins.
For example, AMD's Data Center segment has ~40% margins while Gaming might be ~15%. A shift toward Data Center means higher overall profitability even if total revenue stays flat.
Watch for: