CISCO SYSTEMS INC (1CSCO.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1CSCO - US17275R1023 - Common Stock
63.25 EUR
-0.36 (-0.57%)
Overall 1CSCO gets a fundamental rating of 6 out of 10. We evaluated 1CSCO against 31 industry peers in the Communications Equipment industry. While 1CSCO belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. 1CSCO has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- In the past year 1CSCO was profitable.
- In the past year 1CSCO had a positive cash flow from operations.
- Each year in the past 5 years 1CSCO has been profitable.
- In the past 5 years 1CSCO always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 8.53%, 1CSCO belongs to the top of the industry, outperforming 83.87% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 22.04%, 1CSCO belongs to the top of the industry, outperforming 90.32% of the companies in the same industry.
- With an excellent Return On Invested Capital value of 12.86%, 1CSCO belongs to the best of the industry, outperforming 83.87% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for 1CSCO is above the industry average of 10.63%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.53% | ||
| ROE | 22.04% | ||
| ROIC | 12.86% |
ROA(3y)9.67%
ROA(5y)10.49%
ROE(3y)24.29%
ROE(5y)25.65%
ROIC(3y)14.02%
ROIC(5y)15.13%
1.3 Margins
- 1CSCO's Profit Margin of 17.90% is amongst the best of the industry. 1CSCO outperforms 93.55% of its industry peers.
- In the last couple of years the Profit Margin of 1CSCO has declined.
- The Operating Margin of 1CSCO (22.52%) is better than 96.77% of its industry peers.
- 1CSCO's Operating Margin has declined in the last couple of years.
- 1CSCO has a better Gross Margin (64.85%) than 87.10% of its industry peers.
- 1CSCO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.52% | ||
| PM (TTM) | 17.9% | ||
| GM | 64.85% |
OM growth 3Y-6.7%
OM growth 5Y-5.03%
PM growth 3Y-7.78%
PM growth 5Y-4.61%
GM growth 3Y1.26%
GM growth 5Y0.21%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so 1CSCO is still creating some value.
- Compared to 1 year ago, 1CSCO has less shares outstanding
- The number of shares outstanding for 1CSCO has been reduced compared to 5 years ago.
- Compared to 1 year ago, 1CSCO has an improved debt to assets ratio.
2.2 Solvency
- The Debt to FCF ratio of 1CSCO is 2.21, which is a good value as it means it would take 1CSCO, 2.21 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 2.21, 1CSCO is in the better half of the industry, outperforming 74.19% of the companies in the same industry.
- A Debt/Equity ratio of 0.46 indicates that 1CSCO is not too dependend on debt financing.
- 1CSCO has a Debt to Equity ratio of 0.46. This is comparable to the rest of the industry: 1CSCO outperforms 48.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.21 | ||
| Altman-Z | N/A |
ROIC/WACC1.31
WACC9.81%
2.3 Liquidity
- 1CSCO has a Current Ratio of 0.93. This is a bad value and indicates that 1CSCO is not financially healthy enough and could expect problems in meeting its short term obligations.
- 1CSCO has a Current ratio of 0.93. This is amonst the worse of the industry: 1CSCO underperforms 80.65% of its industry peers.
- A Quick Ratio of 0.83 indicates that 1CSCO may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.83, 1CSCO is doing worse than 77.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
- 1CSCO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.20%, which is quite good.
- Measured over the past 5 years, 1CSCO shows a small growth in Earnings Per Share. The EPS has been growing by 3.50% on average per year.
- Looking at the last year, 1CSCO shows a quite strong growth in Revenue. The Revenue has grown by 8.91% in the last year.
- The Revenue has been growing slightly by 2.82% on average over the past years.
EPS 1Y (TTM)10.2%
EPS 3Y4.19%
EPS 5Y3.5%
EPS Q2Q%9.89%
Revenue 1Y (TTM)8.91%
Revenue growth 3Y3.19%
Revenue growth 5Y2.82%
Sales Q2Q%7.53%
3.2 Future
- The Earnings Per Share is expected to grow by 10.07% on average over the next years. This is quite good.
- 1CSCO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.28% yearly.
EPS Next Y10.59%
EPS Next 2Y9.4%
EPS Next 3Y8.67%
EPS Next 5Y10.07%
Revenue Next Year7.24%
Revenue Next 2Y6.15%
Revenue Next 3Y5.75%
Revenue Next 5Y6.28%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- 1CSCO is valuated rather expensively with a Price/Earnings ratio of 19.11.
- Based on the Price/Earnings ratio, 1CSCO is valued cheaper than 80.65% of the companies in the same industry.
- 1CSCO is valuated rather cheaply when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- The Price/Forward Earnings ratio is 16.33, which indicates a correct valuation of 1CSCO.
- 83.87% of the companies in the same industry are more expensive than 1CSCO, based on the Price/Forward Earnings ratio.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.98, 1CSCO is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.11 | ||
| Fwd PE | 16.33 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as 1CSCO.
- 67.74% of the companies in the same industry are more expensive than 1CSCO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.05 | ||
| EV/EBITDA | 19.1 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- 1CSCO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.8
PEG (5Y)5.46
EPS Next 2Y9.4%
EPS Next 3Y8.67%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.18%, 1CSCO has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 2.62, 1CSCO pays a bit more dividend than its industry peers.
- 1CSCO's Dividend Yield is a higher than the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.18% |
5.2 History
- The dividend of 1CSCO has a limited annual growth rate of 2.65%.
Dividend Growth(5Y)2.65%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 62.56% of the earnings are spent on dividend by 1CSCO. This is not a sustainable payout ratio.
- 1CSCO's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP62.56%
EPS Next 2Y9.4%
EPS Next 3Y8.67%
CISCO SYSTEMS INC / 1CSCO.MI FAQ
What is the fundamental rating for 1CSCO stock?
ChartMill assigns a fundamental rating of 6 / 10 to 1CSCO.MI.
What is the valuation status of CISCO SYSTEMS INC (1CSCO.MI) stock?
ChartMill assigns a valuation rating of 5 / 10 to CISCO SYSTEMS INC (1CSCO.MI). This can be considered as Fairly Valued.
Can you provide the profitability details for CISCO SYSTEMS INC?
CISCO SYSTEMS INC (1CSCO.MI) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for 1CSCO stock?
The Price/Earnings (PE) ratio for CISCO SYSTEMS INC (1CSCO.MI) is 19.11 and the Price/Book (PB) ratio is 6.26.
Can you provide the financial health for 1CSCO stock?
The financial health rating of CISCO SYSTEMS INC (1CSCO.MI) is 4 / 10.