Cisco Systems, Inc. (CSCO): A Resilient Tech Company With a Huge Cash Pile

Hedge fund trade

At the end of 2012, there were 58 hedge funds long Cisco, which includes its top hedge fund owner by market, Donald Yacktman’s Yacktman Asset Management. Yacktman had a position close to $1.03 billion, accounting for 6.2% of its total 13F portfolio (check out Yacktman’s stock picks).

For Alcatel Lucent SA (ADR) (NYSE:ALU), four of its top hedge fund owners going into 2013 were new positions. SAC Capital, the top hedge fund owner by market value, took a new position worth $39 million (check out SAC’s top picks). Juniper Networks, Inc. (NYSE:JNPR)’s top fund owner was billionaire Ken Griffin of Citadel Investment Group, having a $151 million position (see Griffin’s dividend picks).

Conclusion

Overall, Cisco Systems, Inc. (NASDAQ:CSCO) generates lots of cash and is staying ahead of its competitors through acquisitions. Additionally, the company has a solid cash balance, which accounts for most of its share price and after stripping away the cash, the company is trading on a forward earnings ratio of just 6 and is expected to grow earnings per share by 28% this year.

Cisco’s cash balance is its biggest bright spot and the company is just starting to return this cash to shareholders. After doubling its dividend in 2012, investors should be in line for increasing returns in the future. Cisco is a strong company with a long heritage and plenty of potential for growth and shareholder returns.

Marshall Hargrave has no position in any stocks mentioned. The Motley Fool recommends Cisco Systems.

The article A Resilient Tech Company With a Huge Cash Pile originally appeared on Fool.com.

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