Is Cisco Systems, Inc. a Buy?

For years, the company's primary business of selling switches and routers has stalled. Is Cisco finally turning the ship around?

The stock price of Cisco Systems, Inc. (NASDAQ:CSCO) has recently enjoyed a bit of a renaissance. The company, which develops and sells networking hardware, has seen its shares increase almost 100% over the past five years compared to the S&P 500 index's 67% return. This, even though the business has not shown any fundamental improvements in its numbers over the same period. Don't believe me? Consider: In its 2013 fiscal year, Cisco reported $48.6 billion in revenue and $10 billion of net income. In its 2017 fiscal year, the company reported...wait for it...$48 billion in revenue and $9.6 billion in net income. That's right, over four whole years, the company's revenue and net income actually inched down, not up!

So, if the company isn't recording more sales and earning more income, why are analysts upgrading the stock even after huge moves to the upside? When one looks under the hood, beyond the headline numbers, there are reasons to believe the company is past the better part of a major transition, one that could see it return to growth for years to come. Let's take a look at what some of these catalysts are and whether they make Cisco's stock a buy for investors today.

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