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Cisco Systems ( CSCO ) received several price-target hikes after its fiscal Q3 earnings late Wednesday beat on both the top and bottom lines, as did its earnings and revenue guidance. For its fiscal third quarter , Cisco said revenue rose 3% from the year-earlier period, to $12 billion, just beating the consensus estimate of $11.97 billion, as polled by Thomson Reuters. Cisco said earnings per share minus items rose 5.6% to 57 cents, edging the consensus of 55 cents. Cisco stock rose 4% in morning trade on the stock market today , near 28. FBN Securities analyst Shebly Seyrafi maintained an outperform rating on Cisco and raised his price target to 32 form 30. “We believe that management tone was more upbeat this time than three months ago,” he wrote in a research note. Drexel Hamilton analyst Brian White raised his price target to 36 from 34 and maintained his buy rating on Cisco stock. “Cisco’s strong execution in fiscal Q3 overpowered a challenging demand environment with upside in the quarter and a stronger than expected Q4 outlook,” White wrote in a research note. “Overall, we are very pleased with Cisco’s Q4 outlook, given the economic backdrop and soft IT spending environment.” RBC Capital Markets analyst Mitch Steves, who maintained an outperform rating, raised his price target to 33 from 31. “While we remain cautious on the legacy portfolio given the overall IT spending environment, we think Cisco is continuing to move in the right direction highlighted by solid margin performance and improving business mix,” he wrote. Pacific Crest Securities analyst Brent Bracelin maintained an overweight rating and a price target of 30. “We continue to be impressed by strong execution under the new leadership team,” Bracelin wrote. “Cisco continues to execute a multiyear shift to a software-centric, subscription-driven business model.” Analysts had lowered expectations ahead of Cisco earnings due to the growing number of companies outsourcing computing workloads to cloud computing service providers such as Amazon.com ( AMZN ) and its Amazon Web Services business. The move to cloud computing has lowered demand for Cisco’s networking gear. The lowered expectations also reflected trends toward lower spending on information technology overall. Well aware of the trends, Cisco is diversifying beyond its core switch and router business into newer, higher-growth segments such as software, data centers, security, wireless and the Internet of Things market. Scalper1 News
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