Like most stocks, Cisco Systems Stock (CSCO) has been directly affected by the US China trade deal. Yesterday Cisco shares declined after the projected revenue would fall 3% to 5%. According to CEO Chuck Robbins on a conference call, it was caused by a general weakness in demand. “Robbins said, “It feels like there’s a bit of a pause. ” Cisco has added more than 5% since the October 10-month low and are currently trading at the monthly maximum. Yesterday, November 13, after the market closed, the company reported for the first quarter of fiscal 2020 with results higher than Wall Street’s expectations. Revenue remained virtually unchanged at $13.16 billion, earnings per share increased 12% YoY to $0.84.
Over the past week, Cisco shares rose by 0.39%. The S&P 500 index increased by 0.56% for the same period.
Cisco Systems Stock Support and Resistance
An ambiguous technical picture has developed in the company’s shares. #CSCO quotes are currently consolidating. The issuer is testing local support and resistance levels: 47.50 and 49.00, respectively. There is potential for recovery. Indicators do not give accurate signals: the price has fixed between MA (50) and MA (200); the MACD histogram is near the zero line. It is better to open the positions from the key levels.
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A comparative analysis of the multiples of the company and competing companies indicates that the instrument is underpriced.
Resistance levels: 49.00, 50.00, 51.50.
Support levels: 47.50, 45.50.
Cisco Systems Stock Trading Ideas
We think there may be an opportunity to “buy on the bounces.” Long positions may be opened after the price consolidates above the level of 49.00. The closing of the profitable positions is possible at the levels of 50.50, 52.00 and 53.00. Stop loss – 47.50.
Short positions may be opened after the price consolidates below the level of 47.50 with the targets at 45.00–43.50. Stop loss – 49.00.
Implementation period: 3 days.
Pivot Points
Pivot Classic Fibonacci Camarilla Woodie DM
S3 39.00 43.32 46.32 40.37 —
S2 43.32 44.97 46.72 42.96 —
S1 45.42 45.99 47.11 44.69 44.37
P 47.64 47.64 47.64 47.28 47.12
R1 49.74 49.29 47.91 49.01 48.69
R2 51.96 50.31 48.30 51.60 —
R3 56.28 51.96 48.70 53.33 —
Cisco Systems Stock Recommendations
Nov-13-19 Resumed RBC Capital Mkts Outperform
Nov-11-19 Downgrade Piper Jaffray Overweight → Neutral $55 → $51
Oct-10-19 Downgrade Goldman Buy → Neutral $56 → $48
Sep-11-19 Initiated Evercore ISI Outperform
Aug-15-19 Reiterated RBC Capital Mkts Outperform $64 → $53
Aug-08-19 Initiated Barclays Equal Weight $52
Jun-12-19 Downgrade William Blair Outperform → Mkt Perform
Feb-12-19 Downgrade Morgan Stanley Overweight → Equal-Weight $49
Dec-14-18 Downgrade Nomura Buy → Neutral
Oct-01-18 Reiterated Piper Jaffray Overweight $50 → $53
May-10-18 Initiated Credit Suisse Neutral $41
May-03-18 Initiated JP Morgan Overweight
May-01-18 Initiated Macquarie Outperform
Mar-16-18 Reiterated Citigroup Buy $46 → $52
Feb-16-18 Reiterated Argus Buy $44 → $50
Feb-15-18 Reiterated Stifel Hold $40 → $46
Feb-13-18 Reiterated Citigroup Buy $40 → $46
Feb-12-18 Upgrade Nomura Neutral → Buy
Feb-07-18 Initiated Goldman Buy $48
Jan-19-18 Reiterated KeyBanc Capital Mkts Overweight $39 → $43
Robert Thomas has over 14 years experience in the investments on the institutional side of markets and has an “insider” view on the markets. In addition, he is an futures day trader that focuses on analyzing fundamentals, specifically earnings reports and technical levels. He has a Masters Degree in Business and Economics from Michigan University.