Is Cisco Systems Stock a Buy as its Q4 Results Approach?

Cisco Systems CSCO will help highlight earnings from major tech players this week, with the company set to report results for its fiscal fourth quarter after market hours on Wednesday, August 13.Coinciding with Cisco’s expansion as a computer-networking leader, investors are looking forward to updates on its artificial intelligence endeavors, which include an AI data center architecture partnership with Nvidia NVDA.Offering a wide range of AI solutions, Cisco’s unified silicon architecture, “Silicon One”, is designed to power high-performance networking across data centers and enterprise environments, including AI and machine learning workloads. Furthermore, Silicon One is the only third-party silicon vendor included in Nvidia’s Spectrum-X Ethernet platform, which is the world’s first Ethernet networking platform for AI.Correlating with intriguing AI prospects, CSCO is up nearly +60% over the last year, hitting a 52-week high of $72 a share in today's trading session. Image Source: Zacks Investment Research Cisco’s Q4 Expectations Based on Zacks' estimates, Cisco’s Q4 sales are thought to have increased 7% to $14.6 billion versus $13.64 billion in the comparative quarter. On the bottom line, Q4 earnings are expected to be up 11% to $0.97 per share compared to EPS of $0.87 in the prior period.Overall, Cisco’s total sales are expected to be up 5% as it rounds out fiscal 2025 to $56.59 billion, with annual EPS slated to rise over 1% to $3.79. More intriguing, as alluded to in the Price, Consensus, and Surprise chart above, Cisco has exceeded the Zacks EPS Consensus for a remarkable 31 consecutive quarters, with an average earnings surprise of 3.94% over the last four quarters, as shown below.Image Source: Zacks Investment Research Cisco’s AI-Powered Solutions1. AI InfrastructureGPU-dense servers, modular compute systems (UCS X-Series), and validated designs for deploying AI workloads at scale.Cisco’s AI-native infrastructure supports edge, cloud, and data center deployments, including Nvidia’s Spectrum-X Ethernet platform and converged/simplified infrastructure solutions like FlashStack and FlexPod, which uses NetApp's NTAP storage systems. 2. AgenticOps & AI CanvasCisco’s AgenticOps platform uses AI agents to automate IT operations across networking, security, and cloud domains.Cisco’s AI Canvas is a generative AI interface built on the company’s Deep Network Model, enabling real-time collaboration and automation for network and security operations.3. Webex AI AgentCisco has embedded AI into its Webex platform, a comprehensive suite of cloud-based collaboration tools that can now use conversational intelligence to automate customer service and contact center workflows.4. GPT-in-a-BoxA turnkey solution for deploying generative AI models securely and efficiently, in partnership with Nutanix NTNX. Cisco’s Reasonable Valuation Most appealing to Cisco being a very viable investment regarding the advancement and evolution of AI, is that its stock trades at 17.9X forward earnings. Considering the premium AI-infrastructure related stocks can command, CSCO still trades at a 26% discount to the benchmark S&P 500’s 24.4X forward earnings multiple.Image Source: Zacks Investment Research Bottom Line Cisco Systems stock sports a Zacks Rank #2 (Buy) ahead of its Q4 report and could certainly be in store for higher highs if the company can continue the ultra-impressive streak of surpassing earnings expectations and offer positive guidance that reaffirms investors' high sentiment for its AI endeavors.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cisco Systems, Inc. (CSCO): Free Stock Analysis Report NetApp, Inc. (NTAP): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis Report Nutanix (NTNX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks