Cisco Systems, Inc. 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. The company also offers switching portfolio encompasses campus switching as well as data center switching; enterprise routing portfolio interconnects public and private wireline and mobile networks, delivering highly secure, and reliable connectivity to campus, data center and branch networks; wireless products include wireless access points and controllers; and compute portfolio including the cisco unified computing system, hyperflex, and software management capabilities, which combine computing, networking, and storage infrastructure management and virtualization. In addition, it provides Internet for the future product consists of routed optical networking, 5G, silicon, and optics solutions; collaboration products, such as meetings, collaboration devices, calling, contact center, and communication platform as a service; end-to-end security product consists of network security, cloud security, security endpoints, unified threat management, and zero trust; and optimized application experiences products including full stack observability and network assurance. Further, the company offers a range of service and support options for its customers, including technical support and advanced services and advisory services. It serves businesses of various sizes, public institutions, governments, and service providers. The company sells its products and services directly, as well as through systems integrators, service providers, other resellers, and distributors. Cisco Systems, Inc. has strategic alliances with other companies. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.

Cisco Systems, Inc.

Broadcom AVGO and Cisco Systems CSCO are benefiting from strong demand for AI infrastructure, data center build-outs and an increasing cybersecurity threat landscape. Both offer high-performance networking hardware essential for connecting AI accelerators. In data centers, both companies are leveraging the next-generation AI Ethernet fabric for scalability and openness.
AI infrastructure solutions from AVGO and CSCO are being integrated into platforms provided by hyperscalers and enterprise cloud providers, including Google Cloud, Microsoft Azure and AWS. Both Broadcom and Cisco are investing in green and scalable infrastructure architectures to address the need for growing AI traffic. Both companies offer solutions that cater to core data centers, as well as edge environments.
Gartner projects AI spending to hit $1.48 trillion in 2025 and $2.02 trillion in 2026 compared with $987 billion in 2024. Both Broadcom and Cisco are well-positioned to benefit from this strong spending expectation on AI. Strong prospects have been driving performance, with shares of Broadcom and Cisco appreciating 56.2% and 20.6% year to date, respectively.
AVGO and CSCO Stock’s Performance
Image Source: Zacks Investment Research
So, Broadcom or Cisco, which is leading the charge? Let’s find out.
AVGO Rides on Strong Infrastructure Portfolio
Broadcom is benefiting from strong demand for XPUs, which are a type of application-specific integrated circuits (ASICs) necessary to train Generative AI models. Alphabet and Meta Platforms are notable users of Broadcom’s ASICs. XPUs accounted for 65% of AI revenues in the third quarter of fiscal 2025. Consolidated backlog hit $110 billion, and the company has secured more than $10 billion of orders for AI racks based on XPU demand. Broadcom expects fourth-quarter fiscal 2025 AI revenues to jump 66% year over year to $6.2 billion. The company’s deal with OpenAI to develop and deploy 10 gigawatts of custom AI accelerators is a noteworthy development.
AVGO’s networking portfolio is gaining from strong demand for Tomahawk 5 and 6 products, as well as the Jericho 4 Ethernet fabric router. Tomahawk 6 – Davisson (TH6-Davisson), the company’s third-generation Co-Packaged Optics (CPO) Ethernet switch, is now being shipped. TH6-Davisson is specifically designed for the accelerating demands of AI networking, as it delivers an unprecedented 102.4 terabits per second of optically enabled switching capacity.
Broadcom’s security offerings are a part of its broader Infrastructure Software solution that accounted for 42.5% of revenues in the third quarter of fiscal 2025. Broadcom’s focus on delivering AI-powered, proactive security to stay ahead of evolving cyber threats has been noteworthy.
CSCO Benefits From Strong Security Demand, AI Push
Cisco’s aggressive AI push and growing security dominance are driving prospects. AI Infrastructure orders from webscale customers hit $2 billion in fiscal 2025, double the management’s original expectation. The company is expanding its AI portfolio for data centers with new solutions like the Unified Nexus Dashboard, Cisco Intelligent Packet Flow, configurable AI PODs and 400G bidirectional optics. Cisco’s security business is benefiting from strong demand for both Cisco Secure Access, Hypershield and XDR.
Cisco’s expanded partnership with NVIDIA, under which the companies plan to offer solutions that help build AI-ready data center networks, is a game-changer. Integration of Cisco Nexus switches with NVIDIA’s Spectrum-X architecture is offering low-latency, high-speed networking for AI clusters, driving enterprise AI orders. The Cisco Secure AI factory with NVIDIA provides a trusted blueprint for building secure AI-ready data centers for enterprises, sovereign cloud providers and newly emerging Neocloud providers.
An expanding portfolio bodes well for Cisco’s growth trajectory. The company recently introduced new agentic capabilities in Cisco AI Assistant, RoomOS 26 for Cisco Devices, and purpose-built integrations across Cisco devices and the Webex Suite. Cisco announced enhancements to the Webex Customer Experience portfolio, including a new AI-powered tool for supervisors. Expected to be available in early 2026, the enhancements will unify quality management across the contact center. The company is also expanding the Webex ecosystem in India and the Kingdom of Saudi Arabia.
AVGO and CSCO’s Earnings Estimate Revision Positive
The Zacks Consensus Estimate for AVGO’s fiscal 2025 earnings is pegged at $6.72 per share, up 1.7% over the past 60 days, indicating a 38% increase over fiscal 2024’s reported figure.
Broadcom Inc. Price and Consensus
The consensus mark for Cisco’s fiscal 2026 earnings has increased by a penny to $4.04 per share over the past 60 days, suggesting 6% growth over fiscal 2025’s reported figure.
Cisco Systems, Inc. Price and Consensus
Both AVGO’s and CSCO’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. Cisco’s average surprise of 3.86% is slightly better than AVGO’s surprise of 2.82%, reflecting a good quality of earnings beat on a consistent basis.
Valuation: CSCO is Cheaper Than AVGO
Both Cisco and Broadcom are overvalued, as suggested by the Value Score of C and D, respectively.
However, in terms of forward 12-month price/sales, Broadcom shares are trading at 20.18X, significantly higher than Cisco’s 4.69X.
CSCO and AVGO Valuation
Image Source: Zacks Investment Research
Conclusion
Cisco’s aggressive AI push and an expanding portfolio are expected to boost top-line growth in the near term. Broadcom’s expanding AI portfolio, along with a rich partner base, is a key catalyst. Although both companies have a stretched valuation, strong AI spending prospects bode well for them.
Cisco currently carries a Zacks Rank #2 (Buy), which makes the CSCO stock a buy as compared with Broadcom, which currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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AVGO vs. CSCO: Which AI Infrastructure Stock is a Buy Right Now?

Key Points
Artificial intelligence (AI) is a global game-changer that can add $15.7 trillion to the worldwide economy by 2030, according to one lofty projection.
Palantir's sustainable moat is the primary catalyst responsible for a nearly 2,800% gain in its shares since the start of 2023.
However, Palantir is facing an uphill battle against historical headwinds.
For the last three years, no innovation has captivated the attention of Wall Street and everyday investors quite like the evolution of artificial intelligence (AI). Empowering software and systems with the tools to make split-second decisions without the need for human oversight is a game-changer for most industries around the globe, and a technological leap forward that can add $15.7 trillion to the global economy by 2030, according to the analysts at PwC in Sizing the Prize.
While Nvidia has been the clearest beneficiary of the AI revolution on a nominal-dollar basis – its market value has climbed by $4.2 trillion since the end of 2022 – the argument can be made that AI-data mining specialist Palantir Technologies (NASDAQ: PLTR) has knocked Nvidia from its pedestal.
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Since 2023 began, shares of Palantir have surged by roughly 2,780%, with the company adding well over $400 billion in market value. It went from being a business of fringe importance in the tech sector to the 20th-largest publicly traded company on U.S. stock exchanges, as of the closing bell on Oct. 24.
With a move of this magnitude, you can be certain that Wall Street and investors are eagerly awaiting Palantir's third-quarter operating results, which the company will release after the close of trading on Monday, Nov. 3.
Although Palantir has a habit of leaping over the consensus earnings per share (EPS) forecast of analysts -- it's topped expectations by a double-digit percentage in three of the last four quarters -- it seems far likelier that Palantir will disappoint Wall Street come Nov. 3.
Palantir's competitive edge has been on full display
But before investors can look to the future and make predictions, a foundation has to be laid of how we got to a point where Palantir has become one of the most-influential AI stocks on the planet.
The primary catalyst fueling Palantir's outperformance is the company's sustainable moat. Specifically, its two core operating segments lack large-scale competition, which means Palantir doesn't have to concern itself with the idea of other companies siphoning away its contracts or subscriber base.
The historical breadwinner for Palantir is its AI- and machine learning-powered Gotham software-as-a-service (SaaS) platform. Gotham assists the U.S. government and its allies with data collection and analysis, as well as military mission planning and oversight. This segment typically lands four- or five-year deals with federal governments that lead to highly predictable operating cash flow and consistent double-digit sales growth. Gotham is also the reason Palantir became profitable on a recurring basis well ahead of consensus expectations among Wall Street analysts.
The other core SaaS operating segment is Foundry, which caters to businesses. This is a subscription-based service that helps its enterprise clients make sense of their big data to improve supply chains and automate certain operations, to name a small snippet of this platform's uses.
Palantir is one of Wall Street's best examples of AI applications transforming and enhancing the capabilities of cloud-based software. But even with an eye-popping growth forecast and a knack for surpassing analyst EPS expectations, Palantir is likely sledding uphill as it prepares to unveil its third-quarter operating results.
Wall Street's AI darling has a nearly impossible task of impressing investors on Nov. 3
Palantir's biggest challenge boils down to one word: history.
History tells us that every game-changing innovation and hyped technology dating back more than three decades has navigated its way through an eventual bubble in the early stages of its expansion. Without exception, investors have consistently overestimated the adoption rate and early innings utility of next-big-thing trends, which leads to lofty expectations not being met. When next-big-thing bubbles burst, the companies on the leading edge of these trends often taken the brunt of the punishment.
The one thing Palantir has working in its favor is the relative predictability of its operating cash flow. Multiyear government contracts and a subscription-driven platform with Foundry would likely protect it from a revenue cliff in the event of an AI bubble-bursting event. But this doesn't mean Palantir's stock would be out of the woods.
Perhaps the bigger historical hurdle is Palantir's stratospheric valuation.
Prior to the bursting of the dot-com bubble, some of the most-influential internet businesses peaked at price-to-sales (P/S) ratios ranging from 30 to 40, with a little bit of wiggle room at the top end. Companies like Cisco Systems, Amazon, and Microsoft were unable to sustain P/S ratios this high over an extended period.
Keeping in mind that no megacap company has ever been able to maintain a P/S ratio above 30, Palantir Technologies closed out Oct. 24 with a P/S ratio approaching 136! There isn't a revenue or EPS guide imaginable that can satiate the optimism to support a P/S ratio of 136. It would take multiple years of 40%-plus ongoing sales growth just to get Palantir stock down to the P/S ratio range of 30 to 40 that prior bubbles have topped out at.
To make things more complicated, the federal government shutdown has extended well beyond three weeks, as of this writing. Palantir has historically been reliant on Gotham to do its heavy lifting and provide the lion's share of its operating income. The shutdown is stalling new deal potential in the near-term.
When a stock is priced for perfection, Wall Street and investors will expect nothing less. The problem is, even the best companies trip up or slow down from time to time. Palantir's astronomical valuation has its stock set up for disappointment come Nov. 3.
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Sean Williams has positions in Amazon. The Motley Fool has positions in and recommends Amazon, Cisco Systems, Microsoft, Nvidia, and Palantir Technologies. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Prediction: Artificial Intelligence (AI) Powerhouse Palantir Technologies Will Disappoint Wall Street on Nov. 3

Cisco Systems CSCO security business is benefiting from a strong portfolio that comprises Network Security, Identity and Access Management, Secure Access Service Edge (SASE), and Threat Intelligence, Detection, and Response (TIDR) solutions. The acquisition of Splunk has been a game-changer for Cisco’s security business, which accounted for 19.5% of fiscal 2025 revenues that jumped 59% from 2024 to $8.09 billion.
The addition of Splunk has strengthened CSCO’s TIDR offerings. The company has been integrating Cisco Extended Detection and Response (XDR) with Splunk Enterprise Security to create a unified and highly effective solution that helps in preventing, detecting, and responding to sophisticated cyber threats. Cisco has been expanding its SASE architecture, and its cloud-native, AI-powered Hypershield solution is helping the company gain traction in AI-scale data centers.
In the fourth quarter of fiscal 2025, security revenues were $1.95 billion, up 9% year over year, driven by growth in Cisco’s offerings from Splunk and SASE. Splunk and Cisco synergies reported 14% year-over-year growth in new logos for Splunk. Secure Access, XDR, Hypershield and AI Defense added 750 new customers collectively in the reported quarter. More importantly, orders grew mid-single-digit, which reflects the growth prospects for CSCO’s security business.
The Zacks Consensus Estimate for the first quarter of fiscal 2026 service revenues is pegged at $2.24 billion, indicating 11% growth over the figure reported in the year-ago quarter.
CSCO Faces Tough Competition in the Security Domain
Cisco is facing stiff competition from Fortinet FTNT and Okta OKTA in the security domain.
Fortinet benefits from an innovative portfolio backed by more than 500 AI patents and 15 years of development expertise. Fortinet has emerged as a recognized leader across multiple Gartner Magic Quadrants, including SASE Platforms, Enterprise Wired and Wireless LAN Infrastructure, and SD-WAN. The expansion of FortiCloud with new services like FortiIdentity, FortiDrive and FortiConnect demonstrates Fortinet's evolution beyond traditional firewalls into a comprehensive security ecosystem.
Okta’s offerings include Okta AI, a suite of AI-powered capabilities embedded across several products, which empowers organizations to harness AI to build better experiences and protect against cyberattacks. The company benefits from strong demand for its new products, including Identity Governance, Privileged Access, Device Access, Fine Grained Authorization, Identity Security Posture Management, and Identity Threat Protection with Okta AI.
CSCO Share Price Performance, Valuation & Estimates
Cisco shares have appreciated 18.6% year to date, underperforming the broader Zacks Computer and Technology sector’s return of 24%.
CSCO Stock Lags Sector
Image Source: Zacks Investment Research
The CSCO stock is trading at a premium, with a trailing 12-month price/book of 5.93X compared with the industry’s 5.69X. Cisco has a Value Score of C.
CSCO Stock is Overvalued
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for the first quarter of fiscal 2026 earnings is currently pegged at 98 cents per share, unchanged over the past 30 days, suggesting 7.7% growth from the figure reported in the year-ago quarter.
Cisco Systems, Inc. Price and Consensus
The Zacks Consensus Estimate for fiscal 2026 earnings is currently pegged at $4.04 per share, unchanged over the past 30 days, suggesting 6% growth from the figure reported in the year-ago quarter.
Cisco currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Strong Portfolio Aids Cisco's Security Revenues: More Upside Ahead?

Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the First Trust Dow Jones Internet Index Fund (Symbol: FDN) where we have detected an approximate $154.1 million dollar outflow -- that's a 1.9% decrease week over week (from 28,300,002 to 27,750,002). Among the largest underlying components of FDN, in trading today Cisco Systems Inc (Symbol: CSCO) is up about 0.3%, DoorDash Inc (Symbol: DASH) is up about 0.9%, and Roblox Corp (Symbol: RBLX) is up by about 1.6%. For a complete list of holdings, visit the FDN Holdings page » The chart below shows the one year price performance of FDN, versus its 200 day moving average:
Looking at the chart above, FDN's low point in its 52 week range is $191.37 per share, with $287.81 as the 52 week high point — that compares with a last trade of $282.85. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
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Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Also see:
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CWNR Insider Buying
Institutional Holders of MSGS
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

FDN, CSCO, DASH, RBLX: Large Outflows Detected at ETF

Investors in Cisco Systems Inc (Symbol: CSCO) saw new options become available today, for the February 2026 expiration. One of the key data points that goes into the price an option buyer is willing to pay, is the time value, so with 119 days until expiration the newly available contracts represent a potential opportunity for sellers of puts or calls to achieve a higher premium than would be available for the contracts with a closer expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the CSCO options chain for the new February 2026 contracts and identified one put and one call contract of particular interest.
The put contract at the $70.00 strike price has a current bid of $2.01. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $70.00, but will also collect the premium, putting the cost basis of the shares at $67.99 (before broker commissions). To an investor already interested in purchasing shares of CSCO, that could represent an attractive alternative to paying $70.49/share today.
Because the $70.00 strike represents an approximate 1% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 56%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 2.87% return on the cash commitment, or 8.80% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for Cisco Systems Inc, and highlighting in green where the $70.00 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $85.00 strike price has a current bid of 50 cents. If an investor was to purchase shares of CSCO stock at the current price level of $70.49/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $85.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 21.29% if the stock gets called away at the February 2026 expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if CSCO shares really soar, which is why looking at the trailing twelve month trading history for Cisco Systems Inc, as well as studying the business fundamentals becomes important. Below is a chart showing CSCO's trailing twelve month trading history, with the $85.00 strike highlighted in red:
Considering the fact that the $85.00 strike represents an approximate 21% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 78%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 0.71% boost of extra return to the investor, or 2.17% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example is 28%, while the implied volatility in the call contract example is 37%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 250 trading day closing values as well as today's price of $70.49) to be 23%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Also see:
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Institutional Holders of DYTA
Top Ten Hedge Funds Holding RPV
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Interesting CSCO Put And Call Options For February 2026

Key Points
Investors who lacked exposure to the information technology sector over the last decade probably underperformed the S&P 500 by a wide margin.
The information technology sector is home to artificial intelligence powerhouses like Nvidia, Apple, Microsoft, Broadcom, Palantir, and more.
The Vanguard Information Technology ETF invests in over 300 stocks across 12 sub-segments of the sector.
The 500 companies represented in the S&P 500 (SNPINDEX: ^GSPC) index are spread across 11 economic sectors, but information technology is the largest by far with a weighting of 35.1%. That's because the sector is home to the world's three largest companies: Nvidia (NASDAQ: NVDA), Microsoft (NASDAQ: MSFT), and Apple (NASDAQ: AAPL), which have a combined market capitalization of $12 trillion.
Those three stocks have contributed to a near-700% gain in the S&P 500 information technology sector over the past decade, more than tripling the gain of the S&P 500 overall.
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In fact, investors who invested in the entire S&P 500 over the past 10 years, but excluded the information technology sector, would have earned a return of just 81%. Suffice it to say, it has been essential to own a slice of companies like Nvidia, Microsoft, and Apple in order to keep pace with the broader market.
Here's the good news: Buying a slice of the entire information technology sector has never been simpler thanks to the Vanguard Information Technology ETF (NYSEMKT: VGT). It's an exchange-traded fund (ETF) that invests in 314 stocks under the information technology umbrella, including many outside the S&P 500, and 43.6% of the entire value of its portfolio is parked in Nvidia, Microsoft, and Apple. Read on.
The ultimate technology ETF
The Vanguard Information Technology ETF invests across 12 sub-segments of the information technology sector. The semiconductor segment is the largest with a weighting of 31.3%, which isn't a surprise considering Nvidia's valuation has ballooned from $360 billion to $4.4 trillion since the start of 2023.
The semiconductor segment is also home to Broadcom, Advanced Micro Devices, and Micron Technology, which are some of the other top suppliers of the data center chips and components fueling the artificial intelligence (AI) boom.
AI is a prevalent theme across the entire tech space right now. Each of the top 10 holdings in the Vanguard ETF is contributing to the AI industry in some capacity, whether it be through data center infrastructure, software, or cloud services:
Stock
Vanguard ETF Portfolio Weighting
1. Nvidia
17.16%
2. Apple
13.35%
3. Microsoft
13.09%
4. Broadcom
4.47%
5. Oracle
2.34%
6. Palantir Technologies
2.02%
7. Cisco Systems
1.39%
8. Advanced Micro Devices
1.33%
9. International Business Machines
1.33%
10. Salesforce
1.14%
Data source: Vanguard. Portfolio weightings are accurate as of Sept. 30, 2025, and are subject to change.
Apple launched Apple Intelligence in partnership with OpenAI last year, which is a suite of AI-powered apps and features for its iPhones, iPads, and Mac computers. Apple Intelligence can summarize text messages and emails, create images on command, and prioritize notifications based on the preferences of each user. Apple has over 2.35 billion active devices worldwide, so it could become the most dominant consumer AI company in the world.
Microsoft and Oracle are two of the biggest buyers of data center chips and components which they use to develop their own AI software, but they also make money by renting the computing capacity to businesses. In fact, both companies are experiencing more demand for data center capacity than they can possibly supply, as businesses across all industries race to adopt AI.
Palantir is one of the best-performing stocks in the AI space, with a 300% gain over the past year alone. It developed two platforms called Gotham and Foundry, which use AI to help organizations extract value from their data. It also offers a third platform called AIP (Artificial Intelligence Platform), which allows organizations to connect their internal data to large language models (LLMs) so they can create AI applications.
Outside of its top 10 holdings, the Vanguard ETF holds many other powerhouse AI stocks. They include Adobe, Snowflake, Datadog, and cybersecurity giants Palo Alto Networks and CrowdStrike.
The Vanguard ETF has a great track record against the S&P 500
The Vanguard Information Technology ETF has delivered a compound annual return of 14.2% since it was established in 2004, comfortably outperforming the S&P 500, which climbed by 10.4% per year over the same period. However, given the ETF's high degree of exposure to volatile themes like AI, investors should avoid putting all of their eggs in one basket.
Instead, this Vanguard ETF is ideal for investors who might be overly exposed to more defensive areas of the market, like the financials, consumer staples, and real estate sectors which are known for paying high dividends, but tend to generate slower growth.
As I highlighted earlier, excluding the information technology sector from any portfolio tends to result in sluggish returns. Since AI is likely to remain a significant value creator in the coming years, investors who have minimal or no exposure to stocks like Nvidia, Apple, and Microsoft might want to buy the Vanguard Information Technology ETF right now.
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Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Adobe, Advanced Micro Devices, Apple, Cisco Systems, CrowdStrike, Datadog, International Business Machines, Microsoft, Nvidia, Oracle, Palantir Technologies, Salesforce, and Snowflake. The Motley Fool recommends Broadcom and Palo Alto Networks and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Meet the Spectacular Vanguard ETF With 43.6% of Its Portfolio Invested in Nvidia, Apple, and Microsoft

Key Points
Arista is a top networking hardware provider for hyperscale cloud deployments.
It benefits from the secular expansion of the AI market.
It’s still growing rapidly, but its stock is richly valued.
When investors talk about the growing artificial intelligence (AI) market, they tend to focus on chipmakers like Nvidia and cloud leaders like Microsoft (NASDAQ: MSFT). However, the AI boom also generates strong tailwinds for companies that help data centers expand their AI infrastructure to support those demanding applications.
One of those top AI infrastructure plays is Arista Networks (NYSE: ANET), which provides networking hardware and software for many of the top cloud and AI companies. Its stock has already rallied more than 953% over the past five years -- but is it still a worthwhile investment?
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What happened to Arista over the past few years?
Arista differentiates itself from its larger competitor, Cisco Systems (NASDAQ: CSCO), in two major ways. First, Arista mainly sells low-latency switches that are optimized for hyperscale cloud deployments, while Cisco bundles together a broader range of enterprise campus, branch, wide-area networking (WAN), and data center solutions.
Second, Arista makes its modular operating system, EOS, compatible with a wider range of open networking protocols than Cisco's systems, which often lock its customers into a "walled garden." Arista's CloudVision platform also helps its customers monitor their data center infrastructure.
So even though Cisco is still the leading "one stop shop" for big enterprise networks, Arista's flexibility, scalability, and focus on hyperscale deployments made it the preferred networking hardware and services provider for cloud giants like Microsoft and Meta Platforms (NASDAQ: META).
That's why Arista is growing much faster than Cisco. From 2020 to 2024, Arista's revenue grew at a compound annual growth rate (CAGR) of 32%. It achieved that robust growth even as the pandemic, inflation, rising interest rates, trade wars, geopolitical conflicts, and other macroheadwinds rattled the markets.
Metric
2021
2022
2023
2024
1H 2025
Revenue Growth (YOY)
27.2%
48.6%
33.8%
19.5%
29.1%
Adjusted Gross Margin
64.8%
61.9%
62.6%
64.6%
64.9%
Adjusted EPS* Growth (YOY)
27%
59.6%
51.5%
31.2%
34.3%
Data source: Arista Networks. YOY = Year-over-year. *Adjusted for stock splits. EPS = earnings per share.
In 2023 and 2024, Arista's growth slowed down for three reasons. First, the challenging macroenvironment drove some of its top customers to rein in their spending. It generated 26% of its revenue from Meta in 2022, but that percentage dropped to 21% in 2023 and 15% in 2024.
Second, Arista faces competition from generic "white box" networking hardware makers and open source operating systems. Lastly, it's rolling out its higher-speed 800G products for handling heavier AI workloads, but the revenue from those sweeping upgrades can be lumpy.
Will Arista keep growing over the next few years?
From 2024 to 2027, analysts expect Arista's revenue and earnings per share (EPS) to grow at a compound annual growth rate (CAGR) of 22% and 21%, respectively. That's a bit higher than Arista's own outlook for "mid-teens" revenue growth from fiscal 2026 through fiscal 2029. Most of that growth should be driven by more demanding AI workloads, hyperscale cloud deployments, enterprise campus upgrades, and the upgrades to its higher-speed switches.
However, that growth could be throttled by the uneven timing of its hyperscale orders, white box competition, and a rising inventory of uninstalled products. Any big changes in AI spending at Meta and Microsoft, its two largest customers, could also generate unpredictable headwinds. Those two companies could also leverage their scale to drive Arista to lower its prices. At 45 times next year's earnings, a lot of growth is already baked into Arista's stock price. Cisco, which is growing at a much slower rate, trades at 22 times next year's earnings. Therefore, any signs of a slowdown could quickly compress its valuations and deflate its stock.
Is Arista Networks a good AI infrastructure buy right now?
Arista is growing much faster than Cisco and other traditional networking companies; it's carved out a niche in the expanding AI market; and it has plenty of irons in the fire. However, it's a bit richly valued in a market that is already trading at historically high valuations. In other words, Arista is still worth nibbling on as a long-term play on the AI infrastructure market -- but it would be a bit reckless to go all-in on this high-flying stock.
Should you invest $1,000 in Arista Networks right now?
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Leo Sun has positions in Meta Platforms. The Motley Fool has positions in and recommends Arista Networks, Cisco Systems, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Is Arista Networks a Smart Buy for the Next Phase of AI Infrastructure?

Below is Validea's guru fundamental report for CISCO SYSTEMS INC (CSCO). Of the 22 guru strategies we follow, CSCO rates highest using our Multi-Factor Investor model based on the published strategy of Pim van Vliet. This multi-factor model seeks low volatility stocks that also have strong momentum and high net payout yields.
CISCO SYSTEMS INC (CSCO) is a large-cap growth stock in the Communications Equipment industry. The rating using this strategy is 81% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
TWELVE MINUS ONE MOMENTUM:
NEUTRAL
Detailed Analysis of CISCO SYSTEMS INC
CSCO Guru Analysis
More Information on Pim van Vliet
About Pim van Vliet: In investing, you typically need to take more risk to get more return. There is one major exception to this in the factor investing world, though. Low volatility stocks have been proven to outperform their high volatility counterparts, and do so with less risk. Pim van Vliet is the head of Conservative Equities at Robeco Asset Management. His research into conservative factor investing led to the creation of this strategy and the publication of the book "High Returns From Low Risk: A Remarkable Stock Market Paradox". Van Vliet holds a PhD in Financial and Business Economics from Erasmus University Rotterdam.
Additional Research Links
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

CSCO Quantitative Stock Analysis

What Can History Teach Us About Investing in 2025?

Cisco Systems CSCO shares closed at $69.52 on Wednesday, trading very close to the 52-week high of $72.55 it hit on Aug. 11. Cisco’s aggressive AI push and growing security dominance are driving prospects.
AI Infrastructure orders from webscale customers hit $2 billion in fiscal 2025, double the management’s original expectation. However, slowing momentum in networking revenues and a challenging macroeconomic environment have been impacting share price movement. In fiscal 2025, networking revenues declined 3% from 2024’s reported figure.
Year to date (YTD), CSCO shares have appreciated 17.4%, underperforming the Zacks Computer & Technology sector, as well as close peers Broadcom AVGO and Arista Networks ANET. While the broader sector has appreciated 23%, shares of Broadcom and Arista Networks have returned 51.5% and 29.7%, respectively, over the same time frame.
CSCO Stock’s Performance
Image Source: Zacks Investment Research
Meanwhile, Cisco shares are trading at a premium, as suggested by the Value Score of C. In terms of the forward 12-month price/sales, CSCO is trading at a premium of 4.57X, higher than the Zacks Computer Networks industry’s 4.33X.
CSCO Stock’s Valuation
Image Source: Zacks Investment Research
However, Cisco shares are trading at a discount compared with Arista Networks and Broadcom. In terms of the forward 12-month P/S, Arista Networks and Broadcom shares are trading at 17.87X and 19.75X, respectively.
So, does an expanding clientele and strong portfolio improve CSCO’s appeal to investors? Let’s find out.
Expanding Portfolio to Boost Cisco’s Prospects
Cisco’s aggressive AI push and growing security dominance have been major growth drivers. Rapid acceleration in the capacity requirements of the network due to unprecedented levels of network traffic and an ever-evolving threat landscape bodes well for Cisco’s prospects. The AI opportunity further gets a boost from Cisco’s partnership with NVIDIA NVDA.
Cisco’s expanded partnership with NVIDIA, under which the companies plan to offer solutions that help build AI-ready data center networks, is a game-changer. Integration of Cisco Nexus switches with NVIDIA’s Spectrum-X architecture is offering low-latency, high-speed networking for AI clusters, driving enterprise AI orders. The Cisco Secure AI factory with NVIDIA provides a trusted blueprint for building secure AI-ready data centers for enterprises, sovereign cloud providers and newly emerging Neocloud providers.
Cisco’s security business is benefiting from strong demand for both Cisco Secure Access, Hypershield and XDR. In the fourth quarter of fiscal 2025, orders grew mid-single-digit. Splunk and Cisco synergies reported 14% year-over-year growth in new logos for Splunk. Secure Access, XDR, Hypershield and AI Defense added 750 new customers collectively in the reported quarter.
Expanding Portfolio to Aid CSCO’s Top-Line Growth
An expanding portfolio bodes well for Cisco’s growth trajectory. The company recently introduced new agentic capabilities in Cisco AI Assistant, RoomOS 26 for Cisco Devices, and purpose-built integrations across Cisco devices and the Webex Suite. These capabilities will help organizations easily manage and work seamlessly with digital agents.
Cisco announced enhancements to the Webex Customer Experience portfolio, including a new AI-powered tool for supervisors. Expected to be available in early 2026, the enhancements will unify quality management across the contact center. The company is also expanding the Webex ecosystem in India and the Kingdom of Saudi Arabia.
Last week (Oct. 8), Cisco introduced the Cisco 8223, the industry's most optimized routing system for efficiently and securely connecting data centers and powering the next generation of AI workloads. The company also announced the P200 chip, which powers 8223.
CSCO Offers Positive 2026 Guidance
For fiscal 2026, CSCO expects revenues to be $59-$60 billion compared with $56.7 billion reported in fiscal 2025. Non-GAAP earnings are expected between $4 per share and $4.06 per share compared with $3.81 per share reported in fiscal 2025.
Cisco Systems, Inc. Price and Consensus
The Zacks Consensus Estimate for CSCO’s fiscal 2026 revenues is pegged at $59.58 billion, indicating growth of 5.2% on a year-over-year basis. The consensus mark for CSCO’s fiscal 2026 earnings is currently pegged at $4.04 per share, unchanged over the past 30 days, indicating year-over-year growth of 6%.
Here’s Why CSCO Stock is a Buy Right Now
An expanding portfolio makes Cisco well-positioned for sustained growth in an evolving tech landscape. AI push is noteworthy, along with a growing footprint in the security space. These trends bode well for CSCO’s long-term prospects and justify a premium valuation.
CSCO currently carries a Zacks Rank #2 (Buy), suggesting that it may be wise for investors to start accumulating the stock right now. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Periodand min./max. price, $	Price change, %		Volatility, %		Volume, $
Periodand min./max. price, $	CSCO	Industry	CSCO	Industry	Volume, $
Yesterday 70.4 - 71.5	-4.00	20.58	9.57	0.73	794.99M
Week 69.9 - 71.5	-4.43	19.97	2.18	7.59	2.97B
Month 66.8 - 71.5	0.01	19.93	5.09	15.97	17.08B
3 Months 65.8 - 72.6	-0.75	45.34	8.69	23.00	62.23B
6 Months 56.5 - 72.6	19.46	39.70	17.89	34.14	119.44B
Year 52.1 - 72.6	22.30	56.10	22.62	44.04	201.93B
3 years 43.4 - 72.6	51.53	143.89	36.27	82.42	475.42B
5 years 35.3 - 72.6	90.70	264.65	50.64	106.40	822.30B
All time 8.1 - 81.8	437.63	80.27	—	—	787.80B

Cisco Systems, Inc.

Price and volatility history

Risk ratios