MMarketMath

CSCO

Slow growerQuality: Medium (68/100)

Cisco · Information Technology · Communications Equipment

$110.23

52w 66.13 – 130.37

20y monthly, adjusted

Mkt cap

$434.5B

P/E

42.4

P/FCF

32.5

FCF yield

3.1%

ROE

21.7%

Shldr yield

2.9%

div 1.5% + bb 1.4%

What today's price assumes

At $434.5B, the market is pricing in 14.3% annual free-cash-flow growth for the next decade (10% discount rate, 2.5% terminal growth). Over the last ten years, FCF actually grew 1.6% per year — the price asks for acceleration beyond the historical record.

Simple DCF per-share range: $43 · $43 · $54 (4% / base / optimistic growth). An estimate, not a target.

Adjust the assumptions yourself →

Historical multiple lens

At its own median P/OCF of 8.9× across 18 years, CSCO would trade near $32/share (25th–75th percentile: $27–$44); it trades at 30.6× today.

Assumes the historical multiple regime persists — re-ratings can be permanent.

Growth record

Compound annual growth rates from as-filed 10-K data, split-adjusted

Rev 3y

+3.2%

Rev 5y

+2.8%

Rev 10y

+1.4%

EPS 5y

−0.7%

EPS 10y

+3.8%

FCF 5y

−1.9%

FCF 10y

+1.6%

Fundamentals

Fiscal 2008–2025, from SEC filings

Revenue

2008: $39.5B
2009: $36.1B
2010: $40.0B
2011: $43.2B
2012: $46.1B
2013: $48.6B
2014: $47.1B
2015: $49.2B
2016: $49.2B
2017: $48.0B
2018: $49.3B
2019: $51.9B
2020: $49.3B
2021: $49.8B
2022: $51.6B
2023: $57.0B
2024: $53.8B
2025: $56.7B
$0$20.0B$40.0B
08
11
14
17
20
23

Net income

2008: $8.1B
2009: $6.1B
2010: $7.8B
2011: $6.5B
2012: $8.0B
2013: $10.0B
2014: $7.9B
2015: $9.0B
2016: $10.7B
2017: $9.6B
2018: $110.0M
2019: $11.6B
2020: $11.2B
2021: $10.6B
2022: $11.8B
2023: $12.6B
2024: $10.3B
2025: $10.2B
$0$5.0B$10.0B
08
11
14
17
20
23

Free cash flow

2008: $10.8B
2009: $8.9B
2010: $9.2B
2011: $8.9B
2012: $10.4B
2013: $11.7B
2014: $11.1B
2015: $11.3B
2016: $12.4B
2017: $12.9B
2018: $12.8B
2019: $14.9B
2020: $14.7B
2021: $14.8B
2022: $12.7B
2023: $19.0B
2024: $10.2B
2025: $13.3B
$0$5.0B$10.0B$15.0B
08
11
14
17
20
23

Diluted shares (lower is better)

2008: 6.2B
2009: 5.9B
2010: 5.8B
2011: 5.6B
2012: 5.4B
2013: 5.4B
2014: 5.3B
2015: 5.1B
2016: 5.1B
2017: 5.0B
2018: 4.9B
2019: 4.5B
2020: 4.3B
2021: 4.2B
2022: 4.2B
2023: 4.1B
2024: 4.1B
2025: 4.0B
02.0B4.0B6.0B
08
11
14
17
20
23

Margins

0%20%40%60%081114172023
Net marginFCF marginGross margin

Capital returned (dividends + buybacks)

2008: $10.4B
2009: $3.6B
2010: $7.9B
2011: $7.4B
2012: $6.1B
2013: $6.1B
2014: $13.2B
2015: $8.4B
2016: $8.7B
2017: $9.2B
2018: $23.5B
2019: $26.7B
2020: $8.7B
2021: $9.0B
2022: $13.9B
2023: $10.6B
2024: $12.2B
2025: $12.4B
$0$10.0B$20.0B
08
11
14
17
20
23

Cash vs long-term debt

$10.0B$20.0B081114172023
CashLT debt

Quarterly

Discrete quarters from 10-Q filings; Q4 derived as fiscal year minus Q1–Q3. OCF is unwound from the year-to-date figures 10-Qs report. Compare to the same quarter a year ago — most businesses are seasonal.

Revenue by quarter

Q3'23: $14.6B
Q4'23: $15.2B
Q1'24: $14.7B
Q2'24: $12.8B
Q3'24: $12.7B
Q4'24: $13.6B
Q1'25: $13.8B
Q2'25: $14.0B
Q3'25: $14.1B
Q4'25: $14.7B
Q1'26: $14.9B
Q2'26: $15.3B
Q3'26: $15.8B
$0$5.0B$10.0B$15.0B
23
24
25
25
26

Net income by quarter

Q3'23: $3.2B
Q4'23: $4.0B
Q1'24: $3.6B
Q2'24: $2.6B
Q3'24: $1.9B
Q4'24: $2.2B
Q1'25: $2.7B
Q2'25: $2.4B
Q3'25: $2.5B
Q4'25: $2.5B
Q1'26: $2.9B
Q2'26: $3.2B
Q3'26: $3.4B
$0$1.0B$2.0B$3.0B
23
24
25
25
26
QuarterRevenueYoYNet incomeYoYEPSOCF
Q3'26$15.8B+12.0%$3.4B+35.4%0.85$3.8B
Q2'26$15.3B+9.7%$3.2B+30.8%0.80$1.8B
Q1'26$14.9B+7.5%$2.9B+5.5%0.72$3.2B
Q4'25 *$14.7B+7.6%$2.5B+17.9%0.64$4.2B
Q3'25$14.1B+11.4%$2.5B+32.1%0.62$4.1B
Q2'25$14.0B+9.4%$2.4B−7.8%0.61$2.2B
Q1'25$13.8B−5.6%$2.7B−25.5%0.68$3.7B
Q4'24 *$13.6B−10.3%$2.2B−45.4%0.54$3.7B
Q3'24$12.7B−12.8%$1.9B−41.3%0.46$4.0B
Q2'24$12.8B−5.9%$2.6B−5.0%0.65$808.0M
Q1'24$14.7B+7.6%$3.6B+36.3%0.89$2.4B
Q4'23 *$15.2B+16.0%$4.0B+40.6%0.97$6.0B
Q3'23$14.6B+13.5%$3.2B+5.5%0.78$5.2B

Track record

Compound annual growth by period. For debt and share count, negative is the good direction.

Series3y5y10y15y
Revenue+3.2%+2.8%+1.4%+2.3%
Operating cash flow+2.4%−1.7%+1.2%+2.2%
Free cash flow+1.4%−1.9%+1.6%+2.5%
EPS (diluted)−3.3%−0.7%+3.8%+4.4%
Equity+5.6%+4.3%−2.4%+0.4%
LT debt+39.5%+14.6%+0.6%+4.3%
Diluted shares−1.6%−1.2%−2.5%−2.5%
Stock price+27.7%+16.5%+16.8%+17.3%

$100, 3 years ago

$208vs $176 in SPY

27.7% vs 20.7%/yr

$100, 5 years ago

$215vs $181 in SPY

16.5% vs 12.6%/yr

$100, 10 years ago

$472vs $412 in SPY

16.8% vs 15.2%/yr

$100, 15 years ago

$1,089vs $813 in SPY

17.3% vs 15.0%/yr

The $1 test — market value created per $1 of earnings retained (Buffett's hurdle: at least $1)

Last 5 years

$4.97

$119.3B created / $24.0B retained

Last 10 years

$4.48

$175.0B created / $39.1B retained

Quality & capital discipline

Cash-based returns and how management deploys capital

Cash ROIC

20.4%

OCF ÷ (equity + debt)

OCF / EV yield

3.2%

MC vs 10× OCF

3.04

≤1 = priced under 10× OCF

Debt / FCF

1.7y

SBC / FCF

27.4%

Owner earnings

$9.6B

OCF − capex − SBC

OE yield

2.2%

Share count 5y

−2.5%

per year; negative = buybacks

Capital intensity

3.7%

net PP&E ÷ revenue

Sales efficiency

$-0.05

new PP&E per $1 new revenue, 5y

Growth engine (5y): reinvested 32.1% of operating cash flow at an incremental return of -5.2% — an organically fundable growth rate of about -1.7% per year (growth ≈ reinvestment rate × incremental ROIC).

Checklist

18 of 27 checks pass · 67%. Checks with structurally missing inputs are excluded.

Growth & Consistency

2/7

  • Revenue growth

    2.8% · 5y CAGR ≥ 5%

    fail

  • EPS growth

    -0.7% · 5y CAGR ≥ 5%

    fail

  • FCF growth

    -1.9% · 5y CAGR ≥ 5%

    fail

  • Revenue rises consistently

    6 of 9 · up in ≥ 7 of last 10 years

    fail

  • FCF consistently positive

    10 of 10 · positive in ≥ 8 of last 10 years

    pass

  • Profitable every year

    10 of 10 · net income > 0 in ≥ 8 of last 10

    pass

  • Cash flow keeps up with sales

    -1.7% vs 2.8% · OCF CAGR ≥ 0.9× revenue CAGR

    fail

Profitability

7/7

  • Net margin

    18.0% · ≥ 8%

    pass

  • Operating margin

    20.8% · ≥ 10%

    pass

  • Gross margin stable or rising

    64.9% vs 62.5% · no drop > 2 pts over 3y

    pass

  • Return on equity

    21.7% · ≥ 12%

    pass

  • Cash ROIC

    20.4% · ≥ 12%

    pass

  • FCF margin

    23.5% · ≥ 5%

    pass

  • Earnings back their cash

    OCF $14.2B vs NI $10.2B · OCF ≥ net income (latest FY)

    pass

Balance Sheet

4/5

  • Debt payable from cash flow

    1.7y · LT debt ≤ 3× FCF

    pass

  • Cash cushion

    37% · cash ≥ 50% of LT debt

    fail

  • Leverage

    0.49 · LT debt ≤ 1.5× equity

    pass

  • Equity positive and compounding

    $46.8B · equity > 0 and grew over ~5y

    pass

  • Interest burden

    14% · interest ≤ 15% of operating income

    pass

Capital Allocation

3/4

  • Share count flat or shrinking

    -2.5% · ≤ +0.5%/yr over ~5y

    pass

  • Stock comp restrained

    27% · SBC ≤ 15% of FCF

    fail

  • Distributions funded by FCF

    94% · dividends + buybacks ≤ 100% of FCF

    pass

  • Repurchases are a habit

    10 of 10 · buybacks in ≥ 5 of last 10 years

    pass

Valuation Discipline

2/4

  • FCF yield

    3.1% · ≥ 3%

    pass

  • Earnings multiple

    42.4 · P/E ≤ 25

    fail

  • Price asks less than history delivered

    14.3% vs 1.6% · implied FCF growth ≤ historical FCF CAGR

    fail

  • Shareholder yield

    2.9% · dividends + buybacks ≥ 2% of market cap

    pass

Financial data

As filed in 10-Ks; per-share figures split-adjusted. $ in millions.

FYRevenueGross profitOp incomeNet incomeEPSOCFCapExFCFDividendsBuybacksSBCCashLT debtEquityShares
202556,65436,79011,76010,1802.5514,19390513,2886,4376,0003,6418,34622,86146,8433,998
202453,80334,82812,18110,3202.5410,88067010,2106,3845,7873,0747,50819,62145,4574,062
202356,99835,75315,03112,6133.0719,88684919,0376,3024,2932,35310,1236,65844,3534,105
202251,55732,24813,96911,8122.8213,22647712,7496,2247,6891,8867,0798,41639,7734,192
202149,81831,89412,83310,5912.5015,45469214,7626,1632,8771,7619,1759,01841,2754,236
202049,30131,68313,62011,2142.6415,42677014,6566,0162,6591,56911,80911,57837,9204,254
201951,90432,66614,21911,6212.6115,83190914,9225,97920,7171,57011,75014,47533,5714,453
201849,33030,60612,3091100.0213,66683412,8325,96817,5471,5768,93420,33143,2044,881
201748,00530,22411,9739,6091.9013,87696412,9125,5113,6851,52611,70825,72566,1375,049
201649,24730,96012,66010,7392.1113,5701,14612,4244,7503,9091,4587,63124,48363,5865,088
201549,16129,68110,7708,9811.7512,5521,22711,3254,0864,3241,4406,87721,45759,6985,146
201447,14227,7699,3457,8531.4912,3321,27511,0573,7589,4131,3486,72620,33756,6545,281
201348,60729,44011,1969,9831.8612,8941,16011,7343,3102,7731,1207,92512,92859,1205,380
201246,06128,20910,0658,0411.4911,4911,12610,3651,5014,5601,4019,79916,29751,2865,404
201143,21826,5367,6746,4901.1710,0791,1748,9056586,7131,6207,66216,23447,2265,563
201040,04025,6439,1647,7671.3310,1731,0089,165—7,8641,5174,58112,18844,2675,848
200936,11723,0947,3226,1341.059,8971,0058,892—3,6111,2315,71810,29538,6475,857
200839,54025,3469,4428,0521.3112,0891,26810,821—10,4411,1125,191—34,4026,163

Some concepts are structurally absent for certain industries (banks report no gross profit or capex). Missing ≠ zero.

Compare with peers →·10-K filings on EDGAR ↗