Cisco Systems, Inc (NASDAQ: CSCO) designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan and China. It provides infrastructure platforms, including networking technologies of switching, routing, wireless, and data center products that are designed to work together to deliver networking capabilities, and transport and/or store data. The company also offers collaboration products comprising unified communications, Cisco TelePresence, and conferencing, as well as the Internet of Things and analytics software. In addition, it provides security products, such as network security, cloud and email security, identity and access management, advanced threat protection, and unified threat management products; and cloud and system management products.
Cisco, one of the largest tech stocks with a $162 billion market capitalization, has an excellent balance sheet with very little debt ($3.59 billion in free cash flow). Cisco boasts excellent operating metrics, pays a generous dividend (3.20%) and is trading at a steep discount to the sector. Cisco has been buying back its stocks. Cisco (super profitable and gushing free cash flow) is regarded as an industry bellwether. Cisco’s share price does not reflect the underlying fundamentals of the company. The long-term growth story for Cisco is intact. Thus, Cisco stock is trading at a steep discount to the median but offers a lot of upside.