Major U.S. Indices Close Lower; Cisco Raises Guidance
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy CSCO?
Source: Benzinga
- Dow Jones Performance: On Wednesday, the Dow Jones Industrial Average slipped 0.13% to close at 50,121.40, indicating overall market weakness and cautious investor sentiment, which may impact short-term investment decisions.
- Cisco Earnings Outlook: Cisco expects third-quarter revenue to range between $15.4 billion and $15.6 billion, exceeding market estimates of $15.18 billion, while raising its fiscal 2026 revenue guidance to $61.20 billion to $61.7 billion, demonstrating confidence in future growth.
- AppLovin Stock Volatility: AppLovin's stock fell 3.41% to close at $456.81, despite reaching an intraday high of $471.97, remaining below its 52-week peak of $745.61, reflecting market concerns about its future performance.
- QuantumScape Earnings Impact: QuantumScape's stock declined 1.34% to $8.82, even though it reported a narrower-than-expected fourth-quarter loss, with shares plummeting nearly 10.5% in after-hours trading, indicating investor caution regarding its future prospects.
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Analyst Views on CSCO
Wall Street analysts forecast CSCO stock price to rise
13 Analyst Rating
10 Buy
3 Hold
0 Sell
Strong Buy
Current: 75.000
Low
76.00
Averages
91.30
High
100.00
Current: 75.000
Low
76.00
Averages
91.30
High
100.00
About CSCO
Cisco Systems, Inc. designs and sells a range of technologies that power the Internet. The Company is integrating its product portfolios across networking, security, collaboration, applications and cloud. The Company's segments include the Americas; Europe, Middle East, and Africa (EMEA), and Asia Pacific, Japan, and China (APJC). Its Networking product category represents its core networking technologies of switching, routing, wireless, fifth generation (5G), silicon, optics solutions and compute products. Its Security product category consists of its cloud and application security, industrial security, network security, and user and device security offerings. Its Collaboration product category consists of its meetings, collaboration devices, calling, contact center and platform as a service (CPaaS) offering. Its Observability product category consists of its full stack observability offerings.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Capital Return Strategy: Cisco returned $3 billion to shareholders in Q2 through dividends and buybacks, with an annual dividend expense of approximately $6.63 billion, and projected free cash flow of $13.64 billion in fiscal 2026 to support future dividend increases.
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See More
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- Strong Employment Data: Nonfarm payrolls increased by 130,000, significantly exceeding the forecast of 70,000, indicating labor market resilience; however, the CPI rose only 0.2% month-over-month, below the expected 0.3%, potentially raising concerns about sustained inflation.
- Earnings Volatility: Kraft Heinz announced a pause on its separation plan to focus on strengthening its existing business, indicating a commitment to future growth; conversely, Hims & Hers abandoned a new product launch due to regulatory pressures, leading to a sharp stock decline and highlighting market sensitivity to compliance risks.
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- Healthcare Transformation Potential: CVS Health's leadership emphasizes AI's critical role in reshaping healthcare experiences, acknowledging early implementation stages while driving cost savings and growth, showcasing its strategic value in the healthcare sector.
- Enhanced Competitive Advantage: Hilton's CEO highlights that their modern tech stack provides a significant competitive edge, with opportunities in distribution and operational efficiency far outweighing risks, reflecting a positive outlook for the future.
- Infrastructure Investment: Cisco executives report that over 90% of customer support cases are now AI-driven, significantly enhancing customer satisfaction, indicating the company's crucial role in the infrastructure of the AI era.
- Semiconductor Market Growth: Applied Materials anticipates that investments in AI infrastructure will drive over 20% growth in its semiconductor equipment business in 2026, demonstrating the substantial impact of AI on industry revenues.
See More
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- Positive Job Data: Recent U.S. employment figures indicate a rise in new jobs, and while inflation eases, the overall market remains volatile, reflecting investor concerns about future economic prospects that could impact stock performance.
- Mixed Industry Results: Automakers reported mixed earnings, with some industrial stocks outperforming the broader market; however, overall equity demand remains capped, indicating a growing risk-off sentiment among investors.
- AI Panic Trade: The launch of a new freight efficiency platform by an AI firm has spooked markets, leading to sharp declines in traditionally resilient trucking and logistics stocks, as fears grow over the vulnerability of labor-intensive business models to automation.
- Real Estate Impacted: The real estate sector and other old-economy industries have also been hit, as traders express unease over potential AI-driven disruptions, further exacerbating market uncertainty.
See More
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- Logistics Stocks Hit: C.H. Robinson (CHRW) fell over 14% on Thursday due to AI fears, with a total decline exceeding 10% over the week, indicating a pessimistic outlook for the logistics sector's future.
- Brokerage Decline: Charles Schwab's stock dropped around 9% since Tuesday, with the CEO expressing disappointment over the sell-off during a Bloomberg TV interview, despite the company's efforts to leverage AI for client services.
- Real Estate Pressure: CBRE's shares plunged approximately 15.2% over the past week, primarily due to its latest earnings report missing expectations, reflecting market concerns about its profitability.
- Unity Software Plummets: Unity's stock dropped over 26% following its latest earnings release, with Q4 results beating expectations but disappointing first-quarter revenue guidance, leading analysts to believe the company needs time to restore investor confidence.
See More
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- Strong Job Growth: The U.S. economy added 130,000 nonfarm payrolls in January, significantly surpassing expectations of 70,000, with private employers contributing 172,000 jobs, marking the strongest gain since December 2024, despite a government payroll decline of 42,000 for the fourth consecutive month.
- Unemployment Rate Decline: The unemployment rate edged down to 4.3% from 4.4%, indicating a resilient labor market; however, the Bureau of Labor Statistics revised down prior payroll estimates by 898,000 jobs from April 2024 to March 2025, which investors largely viewed as historical data.
- Further Easing Inflation: Consumer prices rose 2.4% year-over-year in January, down from 2.7% and below forecasts of 2.5%, while core inflation eased to 2.5%, the lowest since March 2021, creating room for potential interest rate cuts by the Fed.
- Tech Sector Pressures: Despite favorable macroeconomic indicators, tech giants are facing profit compression concerns due to rising costs for memory and storage products, leading to a loss of over $500 billion in market capitalization among ten tech companies in a single session, reflecting market caution towards tech stocks.
See More
