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Cisco Systems (XSGO:CSCO) ROA %

: 13.29% (As of Apr. 2023)
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ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. Cisco Systems's annualized Net Income for the quarter that ended in Apr. 2023 was $12,848 Mil. Cisco Systems's average Total Assets over the quarter that ended in Apr. 2023 was $96,685 Mil. Therefore, Cisco Systems's annualized ROA % for the quarter that ended in Apr. 2023 was 13.29%.

The historical rank and industry rank for Cisco Systems's ROA % or its related term are showing as below:

XSGO:CSCO' s ROA % Range Over the Past 10 Years
Min: 0.09   Med: 9.75   Max: 12.34
Current: 12.12

During the past 13 years, Cisco Systems's highest ROA % was 12.34%. The lowest was 0.09%. And the median was 9.75%.

XSGO:CSCO's ROA % is ranked better than
91.5% of 2423 companies
in the Hardware industry
Industry Median: 2.98 vs XSGO:CSCO: 12.12

Cisco Systems ROA % Historical Data

The historical data trend for Cisco Systems's ROA % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Cisco Systems Annual Data
Trend Jul13 Jul14 Jul15 Jul16 Jul17 Jul18 Jul19 Jul20 Jul21 Jul22
ROA %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.09 11.25 11.64 11.01 12.34

Cisco Systems Quarterly Data
Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23
ROA % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 13.02 12.06 11.42 11.74 13.29

Competitive Comparison

For the Communication Equipment subindustry, Cisco Systems's ROA %, along with its competitors' market caps and ROA % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Cisco Systems ROA % Distribution

For the Hardware industry and Technology sector, Cisco Systems's ROA % distribution charts can be found below:

* The bar in red indicates where Cisco Systems's ROA % falls in comparison to its industry or sector. The grey bar indicates the ROA %'s extreme value range as defined by GuruFocus.



Cisco Systems ROA % Calculation

Cisco Systems's annualized ROA % for the fiscal year that ended in Jul. 2022 is calculated as:

ROA %=Net Income (A: Jul. 2022 )/( (Total Assets (A: Jul. 2021 )+Total Assets (A: Jul. 2022 ))/ count )
=11812/( (97497+94002)/ 2 )
=11812/95749.5
=12.34 %

Cisco Systems's annualized ROA % for the quarter that ended in Apr. 2023 is calculated as:

ROA %=Net Income (Q: Apr. 2023 )/( (Total Assets (Q: Jan. 2023 )+Total Assets (Q: Apr. 2023 ))/ count )
=12848/( (95840+97529)/ 2 )
=12848/96684.5
=13.29 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

In the calculation of annual ROA %, the net income of the last fiscal year and the average total assets over the fiscal year are used. In calculating the quarterly data, the Net Income data used here is four times the quarterly (Apr. 2023) net income data. ROA % is displayed in the 30-year financial page.


Cisco Systems  (XSGO:CSCO) ROA % Explanation

ROA % measures the rate of return on the total assets (shareholder equity plus liabilities). It measures a firm's efficiency at generating profits from shareholders' equity plus its liabilities. ROA % shows how well a company uses what it has to generate earnings. ROA %s can vary drastically across industries. Therefore, ROA % should not be used to compare companies in different industries. For retailers, a ROA % of higher than 5% is expected. For example, Wal-Mart (WMT) has a ROA % of about 8% as of 2012. For banks, ROA % is close to their interest spread. A bank’s ROA % is typically well under 2%.

Similar to ROE, ROA % is affected by profit margins and asset turnover. This can be seen from the Du Pont Formula:

ROA %(Q: Apr. 2023 )
=Net Income/Total Assets
=12848/96684.5
=(Net Income / Revenue)*(Revenue / Total Assets)
=(12848 / 58284)*(58284 / 96684.5)
=Net Margin %*Asset Turnover
=22.04 %*0.6028
=13.29 %

Note: The Net Income data used here is four times the quarterly (Apr. 2023) net income data. The Revenue data used here is four times the quarterly (Apr. 2023) revenue data.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Like ROE, ROA % is calculated with only 12 months data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. ROA % can be affected by events such as stock buyback or issuance, and by goodwill, a company's tax rate and its interest payment. ROA % may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).

Many analysts argue the higher return the better. Buffett states that really high ROA % may indicate vulnerability in the durability of the competitive advantage.

E.g. Raising $43b to take on KO is impossible, but $1.7b to take on Moody's is. Although Moody's ROA % and underlying economics is far superior to Coca Cola, the durability is far weaker because of lower entry cost.


Cisco Systems ROA % Related Terms

Thank you for viewing the detailed overview of Cisco Systems's ROA % provided by GuruFocus.com. Please click on the following links to see related term pages.


Cisco Systems (XSGO:CSCO) Business Description

Cisco Systems logo
Address
170 West Tasman Drive, San Jose, CA, USA, 95134-1706
Cisco Systems is the largest provider of networking equipment in the world and one of the largest software companies in the world. Its largest businesses are selling networking hardware and software (where it has leading market shares) and cybersecurity software like firewalls. It also has collaboration products, like its Webex suite, and observability tools. It primarily outsources its manufacturing to third parties and has a large sales and marketing staff—25,000 strong across 90 countries. Overall, Cisco employees 80,000 employees and sells its products globally.

Cisco Systems (XSGO:CSCO) Headlines

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