Cisco (CSCO) PT Raised to $29 at Nomura
Nomura Securities analyst Stuart Jeffrey reiterated a Buy rating and lifted his price target on Cisco (NASDAQ: CSCO) to $29.00 (from $27.00) citing low low multiples and strong momentum following Q4 results.
"Strong Q4 revenues and order bookings suggest that FY2015E should see a return to solid growth for Cisco. We expect this revenue momentum to drive solid earnings growth in conjunction with solid gross margins and a more aggressive-than-expected focus on cost cutting. We don’t expect investor expectations to run too aggressively though, given management’s concerns over emerging markets trends and its ongoing weakness in tapping service provider capex. Investors have shown concern at the sustainability of Cisco’s switching earnings as software defined networking (SDN) has emerged. Immediate catalysts seem unlikely; instead we expect Cisco to string together a series of solid quarters, with revenue growth accelerating and operating leverage driving earnings."
The firm moved FY15E EPS from $2.25 to $2.21; FY16E EPS at $2.40
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Shares of Cisco closed at $25.20 yesterday.