Cisco Systems (NASDAQ:CSCO) announced quarterly earnings of $0.83 per share, exceeding the $0.82 per share Zacks Consensus Estimate. The year before, earnings per share were $0.84 adjusted for non-recurring items.
This quarterly report shows a 1.22% earnings surprise. When this provider of routers, switches, software, and services reported earnings a quarter ago, $0.86 per share was anticipated; nevertheless, $0.87 per share was actually earned, producing a surprise of 1.16%.
The business has four times outperformed consensus EPS forecasts during the last four quarters.
For the quarter that ended in July 2022, Cisco, a company in the Zacks Computer – Networking sector, reported revenues of $13.1 billion, outpacing the Zacks Consensus Estimate by 2.75%.
The management’s remarks on the earnings call will be largely responsible for determining if the stock’s current price movement based on previously revealed numbers and anticipated future earnings can be sustained.
Compared to the S&P 500’s decrease of -9.7%, the loss in Cisco’s share price from the year’s beginning has been around 26.2%.
What Will Cisco Do Next?
Investors are wondering what will happen to Cisco’s stock even if it has underperformed the market so far this year.
This important topic doesn’t have simple answers, but one trustworthy metric that can assist investors in answering it is the company’s profits outlook. This includes both the most recent changes to consensus earnings forecasts as well as the current consensus earnings predictions for the upcoming quarter(s).
According to empirical studies, patterns in earnings estimate revisions and short-term stock movements are strongly correlated. Investors can keep track of these adjustments on their own or use a reliable grading tool like the Zacks Rank, which has a proven track record of leveraging the power of earnings estimate revisions.
The estimate revisions trend for Cisco was inconsistent prior to the announcement of these earnings. The stock now has a Zacks Rank #3 (Hold) even though the size and direction of estimate revisions may alter following the company’s recently released earnings report. Therefore, it is anticipated that the shares will soon perform in line with the market. The full list of today’s Zacks #1 Rank (Strong Buy) stocks is available here.
It will be fascinating to watch how forecasts for the upcoming quarters and the current fiscal year shift in the days to come. For the upcoming quarter’s revenues of $12.99 billion and the current fiscal year’s revenues of $53.22 billion, respectively, the consensus EPS projection is $0.85 on $12.99 billion in revenues.
Investors need to be aware that the performance of the stock can also be significantly impacted by the industry outlook. Computer – Networking is now in the top 19% of the more than 250 Zacks industries in terms of Zacks Industry Rank. According to our analysis, the top 50% of the industries as ranked by Zacks outperform the bottom 50% by a ratio of more than two to one.
Another company in the same sector, Lantronix, Inc. (LTRX), has not yet released its earnings for the three months ended in June 2022. On August 18, the outcomes are anticipated to be made public.
In its upcoming report, this firm is anticipated to announce quarterly earnings of $0.08 per share, representing a year-over-year change of +33.3%. Over the past 30 days, the consensus EPS forecast for the quarter has not changed.
Revenues for Lantronix, Inc. are anticipated to be $33.4 million, up 61.8% from the same quarter last year.
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Author Jowi Kwasu 
