CSCO Should I Buy
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Cisco Systems Inc (CSCO) is a good buy for a beginner investor with a long-term strategy and $50,000-$100,000 available for investment. The company's strong financial performance, positive analyst sentiment, and growth in AI infrastructure sales make it a solid choice. Despite some margin pressure, the overall outlook remains favorable.
The technical indicators for CSCO are bullish. The MACD histogram is positive and expanding, RSI is neutral at 74.538, and moving averages show a bullish trend (SMA_5 > SMA_20 > SMA_200). The stock is trading above key support levels, with resistance at R1: 84.282 and R2: 86.224.
Cisco's AI infrastructure orders grew by 62.5% sequentially in Q1 2026, contributing to a 10% YoY revenue growth in Q2
Analysts have raised price targets, with JPMorgan and UBS maintaining 'Overweight' and 'Buy' ratings, citing AI momentum and partnerships with Nvidia.
Endace partnership enhances Cisco's cybersecurity offerings, aligning with growing demand for network security.
Rising costs for DRAM and memory components have pressured gross margins, which are forecasted to remain under pressure.
Erste Group downgraded Cisco to 'Hold,' citing concerns over long-term margin effects.
In Q2 2026, Cisco reported a 9.71% YoY revenue increase to $15.35 billion, a 30.77% YoY net income growth to $3.18 billion, and a 31.15% YoY EPS growth to $0.80. Gross margin improved slightly to 63.46%.
Analysts are generally positive on Cisco. JPMorgan raised its price target to $96, and UBS to $95, both maintaining 'Buy' or 'Overweight' ratings. Truist initiated coverage with a 'Buy' rating and a $94 price target. However, Erste Group downgraded the stock to 'Hold,' citing concerns over gross margins.
