Citigroup has upgraded cisco's rating from neutral to buy, and raised the target price from $52 to $62.
According to Zhidao Finance, Citigroup has upgraded Cisco (CSCO.US) from neutral to buy, and raised the target price from $52 to $62, stating that it will have opportunities in the field of artificial intelligence.
Analyst Atif Malik wrote in a report to clients: "Although artificial intelligence currently accounts for only a small portion of the business (about 2% of revenue), we see potential for greater contribution. With the arrival of more artificial intelligence, our view of the group is gradually becoming more constructive, and we expect investors to continue to shift from semiconductors/hardware to network devices, which will benefit the group's valuation."
In addition, Malik has raised profit expectations for Cisco's 2025 and 2026 fiscal years by 2% and 5% respectively. Analysts generally expect Cisco's earnings per share for the next quarter to be $0.87, with total revenue of $13.77 billion.
Malik believes that the upcoming quarterly performance, set to be released on November 13, could be a "potential catalyst," as Cisco has joined Meta's new artificial intelligence hardware portfolio following Meta's announcement of its new artificial intelligence network architecture "Disaggregated Scheduled fabric" under the leadership of Mark Zuckerberg.
Malik wrote: "We still believe Meta remains an important partner and customer for Arista Networks (ANET.US) (representing approximately 21% of 2023 sales)." He emphasized that while the market may be concerned about this posing a threat to Arista Networks' market share, he believes it is more of a recognition of cisco's technology.