Cisco Systems Remains Top-Performing Dow Stock in 2018

Cisco Systems Inc. (NASDAQ: CSCO) held on to its ranking as the best-performing Dow Jones industrial average stock of the year to date with a modest 1.4% share price gain last week. Since the beginning of the year, Cisco’s stock is up 16.7%.

The second-best performer among the Dow 30 so far this year is Boeing Co. (NYSE: BA), which is up 15.6%. That is followed by Intel Corp. (NASDAQ: INTC), up about 14.2%, Microsoft Corp. (NASDAQ: MSFT), up 12.0%, and Nike Inc. (NYSE: NKE), up 11.2%. Of the 30 stocks comprising the index, just 12 have posted year-to-date gains as of Friday’s close.

The Dow dropped 151.75 points over the course of the past week to close at 24,311.19, down 0.6% for the week. The tech sector as a whole is up nearly 25% over the past 12 months, well ahead financials (up nearly 16%) and consumer discretionary (15.7%) among the S&P’s 11 sectors.

The past week was another quiet one for Cisco. No new 52-week low, nor a new 52-week a high. The stock continued to ride the wave that has carried the tech sector to its top ranking among equity sectors.

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Cisco closes its third fiscal quarter at the end of this month and is scheduled to report results on May 16. Analysts are looking for earnings per share (EPS) of $0.65 and revenues of $12.43 billion. That would be a 12% year-over-year boost to EPS and more than 4% to revenues.

When the company reported second-quarter results in February, adjusted EPS rose 11% and revenues rose 3%. On a GAAP basis, Cisco posted a loss per share of $1.78 due to an $11.1 billion provision for income taxes. The company’s effective tax rate in the second quarter was 20%, and it expects a 21% rate in the third quarter.

Cisco’s shares closed up about 1.1% Friday, at $44.71 in a 52-week range of $30.36 to $46.16. The consensus 12-month price target on the stock is $49.62, up about $0.75 from the previous week, and the forward price-to-earnings ratio is 15.63.

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