Wells Fargo Reiterates an 'Outperform' on Cisco (CSCO); Closer Look Into NDS Acquisition
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Price: $111.68 -1.58%
Rating Summary:
35 Buy, 27 Hold, 0 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
35 Buy, 27 Hold, 0 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Wells Fargo reiterates an 'Outperform' on Cisco (NASDAQ: CSCO) price target range $23-25.
Wells analyst said, "Though we were surprised by the timing and size of the deal, we believe NDS offers Cisco attractive video assets, which should bolster the company's efforts within the service provider market. Moreover, we view the acquisition to be an effective use of overseas cash given the solid margin and growth profile of the underlying NDS portfolio."
"Though large (consuming nearly half of the $5-10B in capital Cisco has committed towards M&A over the next 12-18 months), we note NDS' prior filings suggests FY2011 gross margins were north of 80%, which compares favorably to the ~62-63% generated by Cisco over the last several quarters. Moreover, we believe 40%+ of NDS sales are recurring in nature with customers commonly contracted for 5-year periods. As such, we see opportunity for NDS sales to drive leverage through the Cisco model."
For an analyst ratings summary and ratings history on Cisco click here. For more ratings news on Cisco click here.
Shares of Cisco closed at $19.91 yesterday.
Wells analyst said, "Though we were surprised by the timing and size of the deal, we believe NDS offers Cisco attractive video assets, which should bolster the company's efforts within the service provider market. Moreover, we view the acquisition to be an effective use of overseas cash given the solid margin and growth profile of the underlying NDS portfolio."
"Though large (consuming nearly half of the $5-10B in capital Cisco has committed towards M&A over the next 12-18 months), we note NDS' prior filings suggests FY2011 gross margins were north of 80%, which compares favorably to the ~62-63% generated by Cisco over the last several quarters. Moreover, we believe 40%+ of NDS sales are recurring in nature with customers commonly contracted for 5-year periods. As such, we see opportunity for NDS sales to drive leverage through the Cisco model."
For an analyst ratings summary and ratings history on Cisco click here. For more ratings news on Cisco click here.
Shares of Cisco closed at $19.91 yesterday.
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