Cisco Up on Dividend Boost, Earnings Beat
Shares of Cisco Systems Inc. (NASDAQ: CSCO) were up 5% in afterhours trading on Wednesday following the network equipment giant's better-than-expected results and its announced plan to hike the quarterly dividend by 75%.
Cisco reported a fiscal fourth-quarter profit of $1.92 billion, or $0.36 a share, and revenue of $11.7 billion. That was up from a profit of $1.23 billion, or $0.22 a share, and 11.2 billion in the year-earlier period. The adjusted profit was $0.47 cents a share. Analysts were expecting an adjusted profit of $0.45 per share on revenue of $11.62 billion.
For the current quarter the company expects revenue growth of 2% to 4% year-over-year and profit in the range of $0.45 to $0.47 cents per share, which is in line with consensus expectations.
CEO John Chambers pointed to signs of an improving market on a conference call with analysts. "Now I want to say is it's way too early to call this a trend," he said. "But if this were to continue for a few months, this would be a solid indicator of potential future market improvement in the U.S." That's good news for Chambers, whose job was on the line as Cisco struggled to stay afloat two years ago. He restructured the company, fired a lot of people and sold underperforming operations, and it looks like a turnaround may be taking hold.
The company also raised its quarterly dividend by 75% to 14 cents per share.
Shares are up more than 5% in premarket trading to $18.25. The 52-week trading range is $14.90 to $21.30. Thomson Reuters had a consensus analyst price target of $21.01 before this earnings release.
Filed under: 24/7 Wall St. Wire, Dividend, Earnings, Technology Companies Tagged: CSCO