Scotia Capital Reduces Stake in Cisco Systems by 11.1%

Scotia Capital Inc. has reduced its investment in Cisco Systems, Inc. (NASDAQ: CSCO) by 11.1% during the second quarter of the year, according to a recent filing with the Securities and Exchange Commission (SEC). The firm now holds 468,439 shares of the network equipment provider after selling 58,339 shares in the quarter. Following this transaction, Scotia Capital’s holdings in Cisco are valued at approximately $32.5 million.

Other institutional investors have also adjusted their positions in Cisco Systems. Financial Connections Group Inc. significantly increased its stake by 89.4%, now owning 409 shares worth around $28,000 after acquiring an additional 193 shares. Legacy Investment Solutions LLC and Pandora Wealth Inc. both initiated new positions in the second quarter, each valued at approximately $28,000. Additionally, Nova Wealth Management Inc. and Brown Shipley & Co Ltd purchased new stakes in Cisco, valued at approximately $31,000 and $32,000, respectively. Currently, institutional investors and hedge funds own about 73.33% of Cisco’s stock.

Insider Transactions at Cisco Systems

In related news, insider Jeetendra I. Patel sold 163,896 shares of Cisco on November 14, realizing a total of approximately $12.76 million at an average price of $77.86 per share. Following this sale, Patel retains 281,108 shares, valued at around $21.89 million, reflecting a 36.83% reduction in ownership.

Another executive, Thimaya K. Subaiya, also sold 56,038 shares on November 19, for a total of about $4.39 million at an average price of $78.33. After this transaction, Subaiya’s remaining shares total 179,780, valued at approximately $14.08 million. In total, insiders have sold 1,024,627 shares worth approximately $79.62 million over the past quarter. Insiders currently own 0.01% of the company’s stock.

Cisco Systems’ Financial Performance

Cisco Systems released its latest earnings report on November 12, announcing earnings per share (EPS) of $1.00, surpassing analysts’ expectations of $0.98. The company achieved a net margin of 18.45% and a return on equity of 27.06%, with revenue for the quarter reaching $14.88 billion, exceeding forecasts of $14.77 billion. This represents a 7.5% increase compared to the same period last year, which saw an EPS of $0.91.

Cisco has set its fiscal year 2026 guidance between $4.080 and $4.140 EPS, with second-quarter guidance projected at $1.010 to $1.030 EPS. Analysts predict an EPS of $3.04 for the current fiscal year.

The company also announced a quarterly dividend of $0.41, scheduled for payment on January 21, 2024, to stockholders on record as of January 2, 2024. This dividend translates to an annualized total of $1.64, yielding approximately 2.2%, with a payout ratio of 61.65%.

Analyst Ratings and Future Outlook

Several financial analysts have revised their ratings for Cisco Systems. On August 14, William Blair upgraded the stock to a “hold” rating. Bank of America raised its price target from $85.00 to $95.00, maintaining a “buy” rating. Similarly, Weiss Ratings reiterated a “buy (b)” rating, while Rosenblatt Securities increased its price objective from $87.00 to $100.00. Wells Fargo & Company also raised its target from $83.00 to $95.00, endorsing the stock as “overweight.”

Currently, out of 26 research analysts, seventeen recommend a “buy,” while nine suggest holding the stock. The consensus rating stands at “Moderate Buy,” with an average target price of $84.14.

Cisco Systems, Inc. specializes in designing, manufacturing, and selling Internet Protocol-based networking products, serving markets across the Americas, Europe, the Middle East, Africa, Asia Pacific, Japan, and China. The company’s portfolio includes various products such as enterprise routing, campus switching, and wireless access points, aimed at enhancing communication and information technology infrastructure globally.