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Here’s Why I Think Cisco Is Flying High
Posted by: tyokunbo (IP Logged)
Date: March 12, 2014 10:51AM
In fiscal 2013, Cisco continued its success in its data center business. The company designs numerous products related to the communication and information technology industry worldwide. It also manufactures and sells Internet Protocol and other solutions.
Cisco provides switching and storage products that enable end users connectivity. The company provides solutions for local-area and wide-area networks. Headquartered in San Jose, Calif., Cisco provides technical support and advanced services. It also offers wireless and network-managed services and data center products.
For the first six months of 2014, Cisco outperformed the majority its peers from a revenue growth perspective. It recorded revenues of $23.2 billion, compared with $24.0 billion for the first six months of fiscal 2013. Its non-GAAP net income for the first six months of 2014 was $5.4 billion, compared with $5.3 billion for the same period in the prior year. The company’s cash flow from operations was $2.9 billion for the last quarter, compared with $2.6 billion for the first quarter. The company repurchased stocks for an aggregate purchase price of $4.0 billion during the second quarter.
In the near future, the company hopes to align closely with its customers to transform and meet its long-term market needs. It sees opportunities in the cloud and data center sectors. It expects to drive its growth in the mobility market transition and next-generation video fields. Cisco will invest in services and emerging markets. It expects to focus on the Internet-of-everything to provide a recurring revenue stream. Cisco believes it will create significant opportunities for consumers to obtain a greater value from networked connections.
The company recently introduced Cisco Catalyst 3850 Series Switch. It is the industry’s first converged wire and wireless switch. The company also offered the Cisco Nexus switching family of products. Both enabled Cisco’s switching revenues to increase by 1% compared to fiscal 2012.
Cisco has completed its acquisition of WhipTail Technologies Inc. The move should strengthen its Cisco Unified Computing Systems strategy. It is also to enhance application performances by introducing solid state memories into the Cisco fabric computing architecture.
Cisco faces stiff competition from companies like Alcatel-Lucent (ALU), Hewlett-Packard (HPQ) and Juniper Networks (JNPR). Broadly speaking, Cisco outperformed many of its competitors in terms of a revenue growth prospective. Compared to its peers, Cisco has a crucial advantage. It is able to better navigate dynamic technological environments to uniquely position itself in the industry.
Cisco has a large reach in the Americas. Consequently, its American business grew 8% in fiscal 2013. However, Cisco is also active in the Middle East, Africa, Asia Pacific, China and Japan.
A Glance at Asia
Cisco has begun to deploy its Cisco Videoscape in Asia. The product is a thin-client user interface application designed to enable new multiscreen experiences beyond the set-top box. Tata Sky is the first platform in Asia to deploy this solution.
Wings Across Brazil
Cisco expanded its operations in Brazil with the production of Wi-Fi access points. This is an advanced enterprise product to create a greater value in organizations.
For the future, we can expect Cisco’s revenues to grow through the technology transitions of cloud, mobile, security and video sectors. Moreover, we cannot ignore the innovative nature of the company. It concentrates on the development of new products to meet long-term market needs. It has a strong financial position, and enough room for its international growth. Therefore, I feel bullish about this technology company’s future profitability.
Stocks Discussed: CSCO, HPQ, JNPR,