Cisco Systems Stock is About to Explode: Here's Why

Analyst ratings can greatly influence the share prices of publicly traded companies like Cisco Systems (NASDAQ:CSCO). Lately, ratings provided by 8 analysts over the last quarter have been quite varied, ranging from bulls to bears. Understanding these ratings and reviews can help investors make informed decisions regarding their investments in the company.

A glance at the recent ratings reveals shifting sentiments among analysts over the past 30 days. For instance, analysts from Somewhat Bearish to Bearish have made noticeable adjustments to their ratings and price targets over the past few months. In this article, we will delve into the in-depth analysis of the recent analyst actions and explore their perception of Cisco Systems.

To start with, here's a summary of the analyst ratings in the past few months: Bullish ratings have been down since the start of the quarter; Somewhat Bullish ratings went from 3 to 0, and then back to 3 in the past month; Somewhat Bearish ratings doubled in the first two months; and then went back to 0 in the third month; Indifferent ratings have been stable at 0; and lastly, Bearish ratings have increased significantly from 0 to 4 in the third month. In total, the ratings went from 7 in the beginning to 4 and back up to 8 in the past month.

Another way to analyze these ratings is to examine the average 12-month price target provided by analysts. Currently, the average is $55.00, which is quite a positive shift, marking a 4.9% increase from the previous average of $52.43. Moreover, there is a wide range of target prices; with the high estimate at $60.00 and the low estimate at $49.00.

Here's an in-depth look at the actions taken by each analyst and their firms:

Amit Daryanani of Evercore ISI Group recently raised its ratings to Outperform and set its price target at $60.00, up from the previous target of $55.00. Similarly, Stephen Bersey of HSBC upgraded its rating from Neutral to Buy, and set the target price at $58.00, representing an increase of 25.81% from the prior target price of $46.00. Meanwhile, New Street Research analyst, Pierre Ferragu, announced a new Buy rating for Cisco and set the price target at $57.00.

James Fish of Piper Sandler chose to maintain the Neutral rating but did not change its price target, which remains at $52.00. In contrast, three analysts downgraded their ratings for the company in the last few months; George Notter of Jefferies lowered its rating from Buy to lower Buy and slightly downgraded its price target to $53.00; Deutsche Bank's Matthew Niknam downgraded from Buy to Hold and marginally upped the price target from $52.00 to $53.00; and, Barclays' Tim Long downgraded from Equal Weight to Underweight and reduced the price target from $50.00 to $49.00.

What's driving the recent ratings change? One factor to consider is Cisco's performance and market conditions. For example, financial news suggests Cisco's steady numbers have shown progress over the past few years. However, on the other hand, rising competition and cybersecurity threats could hamper growth, influencing bearish analyst views.

As we can see, these analyst actions reflect a dynamic back-and-forth, reflecting ever-changing opinions on Cisco Systems. While there are valid reasons to invest in the company due to positive ratings and above-average price targets, it's essential to analyze analyst reports thoroughly before making any key investment decisions.