Deutsche Bank (DB) raised its price target on Cisco Systems Inc. (NASDAQ:CSCO) to $24 from $22, while reiterating a "Buy" rating, following the company's solid quarterly results and forecast.
Cisco reported Q2 revenues of $11.5 billion, beating DB estimate $11.1 billion and consensus of around $11.2 billion. Pro-forma EPS of $0.47 beat DB estimate of $0.44 and consensus of $0.43. The company guided slightly above consensus for both revenues and pro-forma EPS.
"We are pleased with the continued order momentum and sales execution," DB analyst Brian Modoff wrote in a note. "We see this as marking share gains."
Modoff believes that the street could be underestimating Cisco's massive installed base in switching and routing. This is a sizeable footprint to drive sales of new architectures such as virtualized fabrics, port extenders, security appliances and other products, he said.
"With expectations relatively modest, we see potential for modest outperformance at current levels," Modoff wrote.
On Thursday, the stock dropped 2.1% to trade at $19.99. The shares have been trading between $13.30 and $22.15 over the past year.