Don’t ignore the professional system risk of Cisco Systems, Citi claimed. Analyst Atif Malik up to date shares of the networking agency to buy from impartial, mentioning a decreasing appraisal void about friends and an increasing AI ethernet general addressable market positioned to strike $10 billion by 2025. “While AI is currently a small piece of the biz (~2% of revs), we see the potential for a stronger contribution,” he composed. “With more AI coming, we are incrementally more constructive on the group and expect continued investor rotation out of semis/hardware into networking equipment to benefit group valuation.” Shares included 1.7% previous to the bell and appeared positioned to enhance their 7% year-to-date achieve. Malik raised the corporate’s value goal to $62 from $52 a share, mirroring relating to 15% upside from Tuesday’s shut. The professional sees the enhancement of the agency’s objects in Meta Platforms’ AI gear as a doable profit and “positive validation of CSCO’s technology.” At the very least 3 vital hyperscalers have truly at the moment began using the agency’s gadgets in backend networks, and Malik sights Cisco’s present $9 billion 2027 hyperscaler AI risk projection as probably downplayed. CSCO YTD hill Shares this yr Malik moreover elevated his EPS approximates for 2025 and 2026 by by 2% and 5%, particularly. “We believe shares warrant a sizable discount to networking peer valuation to reflect lingering share loss concerns, somewhat tempered by growing AI opportunities,” he composed. “Even at a 30+% discounted target multiple to peer average, we see meaningful upside to shares.”
