Cisco (CSCO) PT Raised to $120 at Morgan Stanley

Morgan Stanley analyst Meta Marshall raised the price target on Cisco (NASDAQ: CSCO) to $120.00 (from $91.00) while maintaining a Overweight rating.

The analyst comments "Remain OW, PT to $120 from $91. Our $120 base case reflects ~25x CY27e EPS of ~$4.70, up from our prior 20-21x multiple, as growth is now tracking modestly above the company’s LT +4-6% growth model communicated during its 2024 Analyst Day. We also see greater durability in the AI upgrade cycle, which helps address concerns around runway and supports a higher valuation. Our base case assumes CSCO remains well positioned in AI networking, with some incremental benefit from enterprise AI infrastructure investment, partially offset by the risk that strong 1H demand moderates the pace of FY27 growth. Our $64 bear case reflects 16x CY27 bear case EPS of ~$4, where enterprise demand softens, AI contribution is less durable and valuation moves back toward historical levels. Our $140 bull case reflects 28x CY27 bull case EPS of ~$5, assuming CSCO becomes a larger beneficiary of AI infrastructure spend, captures outsized capacity growth and benefits from a more durable enterprise refresh cycle. Key risks to our PT include tariffs, macro weakness, AI order volatility, gross margin pressure and demand pullforward limiting FY27 growth."

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